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Inevitable Spiral Equity Collapse, Biderman's 'Better Early Than Late' Call To Sell Into Strength
It's the end of deficit spending in Europe as we know it. That's how Charles Biderman, of TrimTabs, rightly describes the unwilling-to-compromise German's (perhaps heroic) attitude to their fellow European sovereigns. From his perspective, this forced austerity will mean slower growth and with that all chance that the European nations can 'grow/tax' their way out of this charade. He notes there is simply no way they can grow fast enough to be able to kick the can far enough down the road for it to matter. Pointing to his 'better early than late' calls on markets over the last 40 years, the man from Sausalito sees it as inevitable that the practical insistence on the elimination of deficit spending will force banks into bankruptcy, leading, as asset values are marked down, to a spiral collapse in equities. He then dismisses the simple-minded decoupling perspective as if no new Keynesian-inspired 'technology shift' occurs, US growth will be in the doldrums as European deleveraging drags global growth down with it. It's not all doom-and-gloom though as he ends on the upbeat notion that this collapse won't happen tomorrow, given balance sheet strength, although selling into rallies is the clear picture he is painting.
(h/t @ZH_Crown)
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Empty ... the picture of our future.
"Slower growth" would be a stay of execution. The markets will measure the severity of the contraction. Stock up on water, food and shelter.
http://georgesblogforum.wordpress.com/2011/11/02/the-daily-climb-2/
Did I hear "Iron Man"?...Oh Yeah, Baby, Tyler, is the "Iron Man"!
MY MAIN MAN
http://www.youtube.com/watch?v=9QQ0hH4MYsk
(Civil) War Pigs
http://www.youtube.com/watch?v=44dg9n8_BxA&feature=fvst
http://www.youtube.com/watch?v=DkGZGPmOcFk
Earnings Earnings Earnings
Yes, we all know the banks are carrying trash marked to fantasy to generate bogus earnings, but that's not that point.
The point is earnings expectations have been crashing for about 2 months now. Europe's recession is going to destroy multinational earnings.
There are lots of reasons to expect an earnings-led equities decline upcoming.
:cue tiger lillies:
http://www.youtube.com/watch?v=5U319VzSqEU
If you don't mind I'll dedicate that song to the 1% who think it's still going to be business as usual going forward, with a special dedication to Jamie Lloyd and Ben.
Must admit this up, down in the markets with them going nowhere can wear you out. That is what markets do. so glad I stopped trading this crap long ago. Just not fun anymore. But I got what I need to survive.
Oh yeah, volitility...Can be worse than the casino!
Austerity slows growth, but isn't that debt financed growth? How does continued high levels of government spending get any more real growth, as opposed to digging a deeper hole? The only way it's different from stimulus from a lower baseline is that people are dependent on the transfers.
So there seems to be a fair number of people who believe the Germans are somehow exempt from the global dominion of the international banking syndicate - that they will somehow be able to 'do right' by their population and not get fucked over to save the bankers. I have some bad news for you - the Germans will be as beholden to the bankers as the US was in 2008. Expect printing, as much as it takes to keep the banks alive, the German position is just posturing.
agreed.
otherwise they would have voted w/the uk
Amen Al Huxley....
No austerity for the wicked! They still have trillions of accumulated middle class assets to steal.
Forced austerity - lol! That's like all those people that show up in the gym on January 2 with a shiny new membership, never to be seen again after January 6. These people will riot before they go that route.
Buckle yer chinstraps.
http://www.youtube.com/watch?v=_eyFiClAzq8 I think it might get nasty but I might make out ok if that is what I want.
WRONG!!!!!!
Germany will? deficit spend.. but only for Germany.. not the benefit of ALL! of Europe.
Germany is more upside down than the Untied States, when Germany re-caps its financial markets.
The Mark Down?
The Debt Write Down?
NEVER! HAPPEN!!
Germany Like China and the Rest of the World! will be resorting to protectionism in the coming days after the credit markets freeze up!
http://www.youtube.com/watch?v=_go0J_luZZE&feature=g-u
Apple Loses IPAD Trademark In China CCTV News
Wanna get pissed off about something else? Try this:
http://www.latimes.com/news/nationworld/nation/la-na-drone-arrest-20111211,0,324348.story
Predator drones in use arresting US civilians in North Dakota.
Hey Jim where abouts generally in MN close to my AO?
What's the timeline for this austerity? Is it going to be implemented starting in January 2012, or January 2050? If it is implemented how they monitor it: daily, weekly, monthly, quarterly, annually? What is the control mechanism? Would these wonderful austerity intentions survive the next financial shock or deep recession coming?
I will now elaborate :
For a long time all FINANCIAL " IN THE KNOWS " have been impressing their more ignorant surroundings with inside understanding of " sophisticated " financial vehicles. I have finally ..as i became increasingly irritated .. because NUMBERS DID NOT SEEM to FIT ... started studying what all these vehicles are about .
And I come to the conclusion that most of them are NOTHING BUT LEVERAGE ,
They are CAPITAL MULTIPLIERS.... meaning enabling SPECULATION for CAPITAL which in reality is NOT PRESENT . I do NOT UNDERSTAND why ZEROHEDGE has not pointed that FACT out more clearly at a far earlier time .
In context of EUROPE ... and NORMAL COMMON PEOPLE ... the latter to which I belong .... I say :
BRAVO MRS MERKEL and SARKOZY ! ... not to forget the highly professional CURRENT POLISH LEADERSHIP of DAY TO DAY BUSINESS OF THE EU !
STAY PUT ... EUROPEAN LEADERS ... DOGGEDLY ... FOCUSED ....
BECAUSE it is high time to put an end to this multitude of FRAUDULENT FINANCIAL SPECULATION ...emmanating out of the ANGLOSAXON WORLD which has too little real capital compared to its GREED ... ex The CITY of LONDON where together with WALL STREET more than 80% of all financial transactions utilizing these FRAUDULENT FINANCIAL VEHICLES have been incepted and put into PLAY for the last decenniums ... to the detrimony of all common people and their nations.. the US and UK ..included !
I do NOT AGREE with the conclusions of above article . Yes ..there may be some ( much needed ) austerity to cope with in time to come ..for EUROPE , But I think we .. in Europe are privileged and gifted enough to be able to survive with ease ... based on SOUND MONEY and our UNSURPASSED CRAFTMANSHIP. Not to mention that NO AREA of corresponding size in the World has INFRASTRUCTURE and a homohenuosly highly EDUCATED POPULATION .. comparable to ... EUROPE .
SO ... I am OPTIMISTIC ! Many unique opportunities lie at head.. for EUROPE .
Our FRIENDLY COOPERATION with RUSSIA and CHINA is developing with breathneck speed ... it is almost like A NEW SILK ROAD is being shaped ... BOTH WAYS ! To our southern borders TURKEY .. a classic EUROPEAN empire with 1000 years of intimate connections with the south east european nations is in the process of becoming member of the EU . It is an ISLAMIC but also in a historical sense mainly a european Country .. and GOUVERNED by SECULAR Principles.. thanks to its founder Kemal Attaturk .. one of the political GIANTS of the World ( born in Thesaloniki ..in Greece ) This will fascilitate an understanding with the remaining Islamic world on our southern border.. much needed and a POSITIVE STEP .
NO .... I can only see a lot of POSITIVE OPPORTUNITIES ... So .. above Article and many other scaremongering ANGLOSAXON Propaganda ... leaves me COLD ... well ..may be even annoyed.. because i can look through the charade ..and see the POLITICAL INTENTIONS ... behind all the BLABBER !
First up, the "ANGLO SAXON" propoganda skit is from a Mr Biderman, a spokesman for the Bankcasino cartel.
Second up, the silk road wet dream is a fantasy, prosperity based on the movement of silks and spices in times of yore and the ability to TAX,CAJOLE and KIDNAP for RANSOM, said entrepeneurs.
Thirdly,the latest technology from Russia,China and Turkey is what?
Ahmeds sheep lube? will this international highway bring us all silk pyjamas? tea? we can get that at Wall-mart, it comes on SHIPS and Aircraft and Trucks, truck convoys from China to Europe is not going to happen.
All technology comes from the west,period (see Transistor and microchip).
All other technology is DERIVATIVE,BASED ON,ON ACCOUNT OF OR A UTILITY. period.
No growth will occur in trade goods in a declinig population, why would it?
The third world has peaked,climaxed and is about to return to it's heathen norm.
UNSURPASSED CRAFTSMENSHIP? i WILL CALL YOU IF i NEED A GLOKENSHPIEL, Delivery in 9 months,right.
I agree with you regarding how evil these derivatives are, but the European patient may not survive this medicine. The entire Europe is 2x more levered than USA. The German banks are some of the worst (or wurst?) offenders. Since Europe is so incredibly levered the process of deleveraging will be extremely painful - not just a single shock but probably a collapse of the house of cards. If you think it can be done with small short term pain then you will be for surprise of your lifetime.
I am not sure if the proposed transaction tax will eliminate derivatives like CDS. It is a step in good direction though. The UK and USA will not cooperate for obvious reasons: we have the most crooks at Walls Street, and they bought all our politicians.
...........he he he....wurst.....he he!!!
You are probably correct - but the pain will be a lot less than it will be in the future If there is a question of the patient surviving it now there is no question that the patient won't survive it in the future.
Merkel may in fact be doing the whole world a great favor by calling a halt to the insanity. If she is successful it may force the United States to take similar measures and thereby prevent us from hurtling over the cliff.
On the transaction tax the problem is that it has been packaged wrong. In India they have a transaction tax on all stock exchange transactions- in exchange there are no capital gains payable on stock market trades done on an exchange. I think people would be much more supportive if the in exchange for the transaction tax we eliminated capital gains. It would reward long term investors, reduce compliance costs and make it much easier for the government to collect the revenues owed to it.
this site has finally found it's Peter Principle in the form of the "not end of the world because the authorities have been trying something to stop it 3 years running." The fact of the matter is while obviously Europe is about to meltdown just as obviously the USA has "the right man at the right time" in the form of Bernanke and Geithner. They have acted since they have not only forseen the actions but forseen the (lack of) responses as well.
Buy Gold, canned goods, start a garden, start learning about keeping and eating animals.
We are headed for the 1500's.
Deal with it.
Live.
That's about all I have to day about current circumstances.
Back to the Renaissance, as it were!
GOT OIL PAINT AND CANVAS??!!
I know we're headed to something very different.
The 1500's isn't what I'm planning for, I'm thinking more 1984.
I'm actually expecting some wierd combination of 1840's Europe, 1920's Germany, 1930's US, and 1940's earth...crammed into the next few months or years. What emerges from that for humanity will be extinction, hell on earth, heaven on earth, or something in-between.
I have food, resources, and skills to live well in a variety of situations. I have my plans and preparations for good and bad times. I am enjoying life and have been told I'm a lucky man! I hope we're having the same discussions next holiday season and not comparing the value of rice and potatos.
>>>I'm thinking more 1984.<<<
1984??? Really???
Just remember Big Santa is watching you.
I will now have to add a Walkman, a VCR and a combination radio/alarm clock/telephone to my wish list...and a cell phone the size of a loaf of bread.
I meant the book, not the year. :)
Not to threadjack, but we have to commence with the tradition:
On nights like tonight there is G.O.P. debate co-hosted by internet portal comanies with Market caps upward of 20B (abc/yahoo) where said companies offer advanced analytics about everything a person would ever think about, sold to TSA,NSA and your local pizza joint. They employ the smartest minds in the world from fields such as mathematics/statistics, physicists, pshychologist and Masters of Business.
The most important thing to understand is that the engine of growth is technological innovation wo we can all grow together. One way to do that is to conduct internet based polls about who might have won the debate. I have two questions about tonight.
www.abcnews.go.com
Abc news took down and reset the poll when Paul had 75% of the vote and voters revoted or didnt know they reset it and hes back up with 80% of the vote.
So ya officially he won the poll I would say, anytime they screw with the voting polls or take it down. RP is an Auto win..
i never noticed how fat newt is. he will die of a heart attack before he get the nomination.
I'll bet he woofs down pork rinds like Pappy Bush did.
Vote here:
http://abcnews.go.com/
Nope. The engine of growth is energy.
HTH.
Sure, but I'd include energy in tech and tech in energy. For all of its flaws goggle,sun,intel and others have done a lot of work around energy/thermo efficient computing. Along those lines, fire was not fulled leveraged until we used it to tenderize meat (big brain needs protien theory) in addition to providing warmth.
isn't it funny that germany is in fear of what the german guy no one remembers did but won't consider dealing with the problem the way the german guy we all remember did to finally fix it.
snarc: Paul Krugman was born in NY to immigrant parents from Belarus. I dont see the connection to him being a "german guy." Unles the aliens are going to call us all germans since some of the first television signals strong enough to exit the atmosphere were originated in the german language.
Krugman for SOS when hillary moves to the supreme court in 2013!
This guy is going to lose you alot of money. Buildinding short positions is beyond the scope of this comment section.
We will see.
Ireland was running a surplus and had no external debt till the British, German, and French banks got together via the EU and put a gun to their heads and told them they would now owe continental bankers over 100 billion euro. "we lent your banks a lot of credit so they could run up a huge housing bubble, now your government owes us big time." The fact that the credit was nothing more than an accounting ghost does not change the fact that every man, woman, and child in Ireland suddenly owes foreign bankers $40,000.
Things change somewhat overnight in the EMU, one thing is certain, the debts created out of nothing and owed by all the people in the western world cannot ever be paid off even at zero interest. No math supports that ability over generations. That is the bottom line isn't it?
I saw the housing bubble and collapse back in the 1990's because I was above the median income yet could not qualify for a loan on even the cheapest house in a questionable neighborhood in Tallahassee in the deep south. Two and two is four and no othe number. Median house price has to equal median incomes that will pay for it. Same goes for the euro, it is all a hall of mirrors. The ECB, Germany and continental banks lent out enough credit made up from nothing to inflate Irish and Spanish and Italian housing and other debt to the point it could never be repaid, then they said either the government/taxpayers make good or we cut you off. So they took the debt on the government and taxpayer backs unwillingly, and now who runs the nation? Not the Irish. And I am deeply disappointed that they fought more than 800 years to be free of the British only to now find themselves enslaved all over again.
But it is nothing compared to the self destruction of America. This country has not even got foreigners to blame, and where it is not too late for the Irish to grow a set and say no more, it really is too late for America. I saw it coming and got my Irish passport in 2002, because I do not want to be in America when it goes down, it will take a large part of the world with it.
To Boiltherich, I'm Irish and I couldn't agree with you more. It saddens me how supine our population are in all of this. Us Irish are still congratulating ourselves over kicking the British out almost 100years ago. Thing is, when the British were kicked out circa 1916-1920, very very few of the population actually took part, the majority were to cowardly/self obsessed to partake....just like todays struggle. A few are fighting, most aren't.
DEUS EX MACHINA
With most of the world’s major economies as well as the financial system bankrupt, there is only one solution that can save the world economy. Like in the Greek tragedies, Deus ex Machina is now the only way that the world can avoid a total economic collapse. This would involve God being lowered down onto the world stage and miraculously saving the plot.
The credit manufacturing system that started in 1913 when the Fed was founded, began its terminal phase in 1971 when Nixon abolished gold backing of the dollar. It has been clear to us for at least 20 years that the outcome was inevitable. It was never a question of “if” but only “when” it would happen. It is now clear to us that the false prosperity that the world has experienced by printing unlimited amounts of money will very soon come to an end. Thus the “if” and “when” conditions are now satisfied so the remaining question is HOW?
More:
http://www.mmnews.de/index.php/english-news/9031-deus-ex-machina
When you are digging a hole you dont want to be in, the first thing you do is stop digging.
The main take-aways I got from Biderman's video is that banks are funding welfare and pensions that governments cannot collect sufficient taxes to pay, but that large (multinational?) companies have a lot of cash.
What springs to mind is that companies have a lot of cash so that if there is another collapse in taxpayer funding of banks, large (multinational) compaies can issue their own trade financing should their be a banking collapse. The cause of the stock market plunge up until the first quarter of 2009 for companies outside the FIRE sector, was because large companies found themselves cut off from their customers via letters of credit arranged by the correspondent banking sector. This may no longer be the case and looks like the shape of things to come; companies financing themselves rather than relying on funding from a corrupted and weak FIRE sector that has merely sought profits from a weak and inept set of successive governments. Companies are smart, fine and perform a very useful economic function, that of employing people and looking for ways to improve the living standards of people.
The case being made in the video, in a rather obtuse way, is that banks have been and are only profitable perpetuating, over the last five decades, and sponsoring profligate government spending on welfare entitlements (and military spending). As an observer and worker in the public and private sectors over this time, this seems to me the logical corrollary of (mostly union demanded as a reaction to poor strategic management of buisnesses) undeliverable promises made by successively weak and poor quality Governments electd by increasingly weak and poor quality voters, dependant on welfare and subsidy.
The austerity that banks fear (and which has seen the migration of US based lobby groups tactics into Europe) is not austerity at all, merely a return to "good behaviour"; austerity is an illusion. It is not austerity, it is simply that we taxpayers, not voters, taxpayers want to "stop digging" a hole and resize economies away from welfare spending financed by, and profited by, banks. The bad loans that banks have accumulated and the accumulated need to fnance welfare deficits (or welfare plus military in the US) over decades have resulted in a level of economic activity that has no basis in today's reality. The sooner we move to a "right sized and uncorrupted" economy the sooner we can move on and let companies improve our living standards.
The bad loans that are included in the size of the economy can either be written off and welfare deficit spending stopped immediately, or the path towards the elimination of these two "vultures" can be accomplished over time. Three years or 40 years. That is the difference.
The Germans want to write off the bad loans and cease welfare deficit spending in an orderly fashion, the rest, don't, led by the profligate and irrational French. The French need the Spanish, Greeks, Italians and Portuguese around because the ability, in the aggregate, of these countries to live byond their means and become more and more indebted, actually does exceed that of the French.
The UK, the US and Japanese Governments, don't even think there is a problem since they are in the kool-aid camp that economic growth will soon revert to a normal 5% p.a. nominal path, reducing their upcoming 6-7% p.a. deficits to a smaller/tolerable 2% p.a. Their problem is that they have debts (including the smoke and mirrors rubbish that reflects their weak leadership qualities through an inability to actually face the truth) of in excess of 200% of GDP. A 5% nominal growth rate would result in 5% bond yields and an interest bill of around one half of their tax takes. (200% GDP times 5% interest = 10% of GDP comapred to a tax take of only 20% of GDP). The debt is bad and all further deficits are worsening the position. What is needed is a return to sub 40% of debt/gdp via fiscal surpluses of 5% of GDP for the next fifteen or twenty years (around US$750 billion p.a. in the case of the US). Good luck with that with the current morons in charge of Government and the trough that is easy money for the banks.
So now to the banks. Their business models have perpetuated the weak behaviour of the government sector, arranging debt, playing the "central bank knows all" myth and dealing in the accumulated debt when it is clear the cost of this debt (via bond yields) is progressivley rigged. Bond markets have been so corrupted by central banks that yields do not reflect either the risk of increased levels of borrowing, nor rational inflation expectations or the fact that the debt can never be paid back.
In other words, the bankers have facilitated the creation of a trough of welfare (and military) spending to governments by appeasing bad government behaviour. The banks can easily "make money" by encouraging this bad behaviour.
"A 5% nominal growth rate would result in 5% bond yields and an interest bill of around one half of their tax takes. (200% GDP times 5% interest = 10% of GDP comapred to a tax take of only 20% of GDP)."
BINGO! No one imagines during this "endless ZIRP" era that nominal rates could get up off the floor like Terminator 2 and bite our collective ass.
But when central banks triple their balance sheets, that's exactly what's gonna happen. You can't pimp a balance sheet to infinity at zero percent -- your currency will break!
>>>What springs to mind is that companies have a lot of cash so that if there is another collapse in taxpayer funding of banks, large (multinational) compaies can issue their own trade financing should their be a banking collapse.<<<
I recall great fear that the GOM oil spill could cripple BP...and that it would be in the nature of a large multi-national bank collapsing for the very reasons you stated, because BP already behaves this way.
Expect oil and gas cos. to rule when this comes apart.
Multinational corporations only exist because (some would say Keynesian) governments foot the bill for the majority of the security that protects their many interests overseas. In a sense, people are paying taxes to protect the racket that exploits the oompa loompas that stole their jobs.
If corporations paid for their own security, they likely wouldn't grow as large and influential, the same holds true if they were made to pay their taxes so the people working in their factories can pay less while still balancing the nation's budget.
One might also notice that ALL of the transfer payments find their final resting place in corporate coffers, not the bank accounts of the poor.
You've put your cart before your horse, slick.
you might be right mr scientist, i was kind of kool-aiding that there might just be some "honest and good" players still out there, I am a glass half full kind of guy.
I'm a "who made this glass two times two big?" kinda guy. ;)
Debt is deflationary. Defaults are inflationary.
The lesson of Iceland; kill the moneylenders. (It's what Jesus would do)
C3X performance sheet dec second week
http://capital3x.com/think-tank/performance-dec-second-week/
Silver Bitchez
If Silver Goes Down All Hell Will Break Loose In The Physical Market
http://www.youtube.com/watch?v=xCCuLMgyUgY
I must be missing something here- if deficit spending by the government is the only way to sustain an economy is that not the ultimate "kicking the can down the road" since debt as percentage of GDP can't keep increasing forever.
I think all the commentators who are so hooked on the idea of government spending being necessary to make up for private sector demand are ignoring an alternative outcome for Europe. The dismantling of the welfare state, privatization and a significant reduction in government regulation along with strong fiscal discipline by the government. What happened to those elements being essential for healthy economic growth.
The worst fear for the United States is that these measure actually do work- it will definitely make the Euro and alternative to the dollar as a reserve currency.
TA bichez! I care not which way prices go, nor how disconnected they are perceived to be with "reality".
We know that all of the finance ministers knew what was going on. Unlimited, cheap credit with no strings attached, collateralised by mark to model GDP, always causes over lending by banks leading to all kinds of asset bubbles. Banks are incentivised to go for quantity over quality in order to compete with each other for 'growth', and no one is criminally punished for making fraudulent loans. The bigger the fraudster, the more 'successful' the bank appears on paper. And if everybody's doing it, people start to think this is normal and it becomes the culture. It's like that experiment where they made students give fellow students ever increasing electric shocks, while acting like it was absolutely normal to torture a person if instructed to do so by an authority figure, most of the students complied. Where these students bad people, or just human? Isn't it human for most people to follow their leaders and peers?
Besides, who wants to be a party pooper? While the party is going, this benefits exporters and others living off this free money gravy train. No one questions the fundamentals.
Politicians love it, the masses are opiated by shopping, everyone is happy and most average people think the good times are due to good governing. Unfortunately when things come to an end and all must pay the piper, the politicians know that they have to try to get out from under the mess that they and their Central Bank handlers and enablers have created without losing their political power, and of course, in order to do this, they must blame everybody else for the pain of the deleveraging hangover that must follow. No one will want to actually pay for this, not the banks, not the people, not the politicians. The vultures will be trying to benefit of course and they will, and here we are.
And then there is this idea of ever increasing 'growth' with no zero or negative growth to indicate long term research and development investment, but that's another subject all together.
I don't see any difficulty. I think many are living in a different reality. Not only does the euro still exist, but politicians are taking measures to reinforce the banks, to avoid a new banking crisis. So, very cool, no panicking politicians. Why should you then? Merry Christmas.
You forgot the "/Sarc"
http://business.financialpost.com/2011/12/08/ecb-offers-banks-unlimited-cash/
"Draghi also said the ECB would start offering banks funding for 3 years for the first time ever, to try to prevent the eurozone crisis precipitating a credit crunch that would choke the bloc’s economy."
Told you so. "Crisis" over. Up for a new boom.
This is the minority's and illegal immigrants' fault. So many of them run the big Wall Street firms and banks that are bringing this country down!
/end sarcasm
Very simple, folks: either they get austerity, which saves the currency, but destroys any political union (leading to the demise of the currency), or they get printing which destroys the currency, but saves the political union (until the economics of independent currencies break it up).
Both EU and Euro are toast; it's just down to the order of operations now.
I beg to differ, the current Euro concoction is toast, as the bank runs and the phony sovereign governments, upto their necks in debt, have destoyed it. But its fall will bring down phony capitalism and the USD hegemony. Euro Union is not dead, its in dire economic attrition but that is the result of American conceived capitalist ponzi, part and parcel of PAx Americana. That has to change in a changing world. The shift away from this american governance of last forty years aka 1965-1971 days has to end. And at the heart of this construct is a) the financial ponzi but b) also the Oil/MIC ponzi around ME oil patch. New energy/ecology paradigm is also required. Lets hope the West does not lose its HEAD and Shoulders along with its phony wealth.
OT: JUSTICE?
LINK: Breaking News: Feds Falsely Censor Popular Blog For Over A Year, Deny All Due Process, Hide All Details…
[h/t NakedCap]
I've a sick feeling in the pit of my stomach after reading this.
ouch, there but for the grace of somebody (God or China?) go all blog sites!
The truth is that no one knows what's going to happen in 2012/2013 and beyond. Everyone only knows pieces of the puzzle, people may know some of the fundamentals very well, or some of the politics, but no one can predict the future with 100% certainty. We know history, and that helps, and we know that people in power don't just stop doing things like blowing asset bubbles because it's the right thing to do. People don't stop privatising profits and socialising losses, hell it's too easy, after all, they are in control of the politicians and the media. People only stop doing things like this, when they are forced to stop doing them by an angry and empowered populace and terrified politicians.
How much more can kicking, asset stripping, and popular debt enslavement will the politicians and central bankers of the world partake in, before they are forced to stop by an angry and empowered populace? I say, a lot more. We are not the at the end of this yet. Things will have to get much worse for us to be there, and by then, the apparatus for totalitarian control of the people through Marshall Law will be firmly in place.
We need to get raped a few more times before anyone gets off their damn iPhone.
This bad news is already priced in, market up 500 points tomorrow.
It'snot so much what he said, it's that it is being said. The voices joining this overall view will rise to a crescendo in the upcoming weeks. It is bothersome that he extrapolates things that have not yet taken place into statements about the stock market not collapsing. Foolishness.
The markets should collapse, but we know that they will be propped up and manipulated as they have been so far, so will they actually collapse? Sure, they will start to collapse, and that's what the Squid and others want to happen, so that when they do, this will this signal for more ever aggressive QE, bail outs, toxic asset purchases by the government, another increase in the debt ceiling, and of course, more taxes and cuts to pay for it. If that doesn't work, a war with Iran will distract us and make the Central Banks a lot of money. The way the system is set up right now, the house always wins.
How long will this continue unabated? I think, until the rule of law applies to everyone. Right now, there is no rule of law. Congress is much more afraid of losing the support of the central bankers than it is of losing the support of the people. That, my friends is every citizen's fault for having been so complacent for so long.
the argument blaming "the citizens" is both tiresome & over-rated. did ya see 60 Minutes alst Sunday, with that douchebag, pussy, condescending worthless impotent moronic prick of an Assitant AG? Guess what? He's an EMPLOYEE of USG - I didn't vote for him. And he's only tip o' the iceberg......
Oil will head lower, says Russian minister of Economics.
It is impossible to buy into this house of cards and yet impossible to sell it, except short-term.
If the hot air ceases even for a day, the Bots will sell it. That is the motivation for kicking the can.
Except for scalping oversold and especially overbought conditions (I love shorting) there is nothing I will do with this contagion.
They are tangled together like mating snakes. We've seen it all before.
"Fallen, fallen is Babylon the Great, she who has made all the nations drink of the wrath of her fornication.
Come out of her, my people, says the Lordthat you may not participate in her sins and that you may not receive of her plagues."
And for you Agnostics -- don't be put off by the word, 'Lord' here; thinking men of any religion, or even no religion, can suss out the meaning of those words.
Biderman is wrong about all the so called corporate cash waiting on the sidelines-
What he see's as cash on balance is nothing more than debt-those companies borrowed money while they could and parked it in case of another credit lock up and they wont be using it for any type of economic expansion-
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Put simply, there is a lot of apparent "cash on the sidelines" because the government and many corporations have issued enormous quantities of new debt, often with short maturities, while other corporations have purchased it. It is an equilibrium. The assets that are held in the right hand represent debt that is owed by the left. You cannot call that pile of short-term marketable securities an asset without calling it a liability. The cash on the sidelines is evidence of debt incurred to fund economic activity that is already in the past. It will remain "on the sidelines" until the debt is retired.
http://www.hussmanfunds.com/wmc/wmc100809.htm
I've always wondered if this were not the case.
The only exceptions I see to this are large multi-national oil cos. like BP who by and large behave as multi-national banks unto themselves.
Oh, I forgot.
JPM Chase just opened up a brand spanking new, state of the art, free-standing branch in the most expensive, most exclusive piece of land in Redondo Beach: The corner of PCH and Torrance Blvd.
I can tell you that the cost of buying or leasing that parcel would be so high, that only the most optimistic business person would consider shelling out that kind of money.
Across the street from that branch is one of the top grossing Wells Fargo locations.
Obviously, senior management at these TPTF institutions are not pulling back or anticipating a GEAB-style systemic meltdown anytime soon.
And, I doubt that any of those bank executives are seriously considering "gold, guns, and a getaway plan". Pretty much business as usual.
Forget Europe it's dead. Oil still bid x that with riots/protests from Italy to England and winding up in France and Germany...FUBAR
It's all China.
Completely agree with this article. Equities are soon going to put in a very significant top. The USD Index continues to capture my attention, which could be the biggest market influence for 2012. A big market move is likely to get started with the USD moving higher in the weeks ahead. Interesting newsletter here with an intermarket analysis outlook for the week. http://bit.ly/vB9T5P
IS this MOFO in his silk pajamas WHAT THE >>>>