Must Read: UBS' Andy Lees On Why The US Economy Is, All Else Equal, Doomed

Tyler Durden's picture

"With all the mess going on at the moment, I thought it was worth while stepping back a little and trying to look at the bigger picture." So begins Andy Lees' latest must read letter to clients whch explains succinctly virtually the entire story of where we were, how we got to where are now, how the current trajectory is unsustainable, why due to decades of capital misallocation anything that the Fed does now is essentially irrelevant, why our untenable debt pile does nothing but perpetuate an unsustainable ponzi scheme which will result in an unseen explosion in the true cost of capital: gold, and why the bond market will eventually, and inevitably, force an epic repricing in the cost of non-gold capital absent the arrival of the deux ex machina of real, actionable innovation that the Fed, and all global central planners, keep hoping for. Because the longer we keep plugging away with that worthless substitute, financial innovation, which is anything but, the greater the final collapse. Andy's conclusion: "Until the debt is cleared and capital starts to be properly allocated, economic growth per unit of additional debt will continue to sour. Until we get some real breakthrough technology, requiring large amounts of capital to both innovate and then roll out, we have no chance of supporting the economy." Too bad than that this absolutely spot on observation reflects precisely the opposite of what the Fed is pursuing. Which is why, all else equal, and it will be unless the Fed is finally eliminated from existence, America, and the entire western way of life, is doomed... But don't take our word for it. Here is Andy.

Why are we here: simple - years of central planning resulting in the greatest experiment in capital misallocation in history.

We are in this mess because of excessive leverage and excessive consumption, financed by excessively cheap real capital – (not just Bernanke & Greenspan but further back to the end of the gold standard, and in fact even before that as it was this misallocation of capital that forced us off the gold standard in the first place). If capital had been allocated productively, then by definition debt would fall as a percentage of GDP. Total debt may rise, but efficient allocation of capital would always mean the economy would grow faster than the debt as it means you are making a positive rather than negative real return on that capital.


Whichever way you look at it, capital has been massively misallocated for years.

Corporate profits... or massive debt-funded ponzi scheme?

How can that be when corporates report massive profits? The profits are based on paying their workers a salary that meant they could only buy the goods they made by borrowing; in other words, a massive unsustainable ponzi scheme that could only ever end up with default.  Without the household debt accumulation, there would be no market to sell their products to, and without paying the workers sufficient, the debt would always have to default.


This required a massive increase in financial innovation to keep the illusion of corporate profitability alive – (household debt was a way of delaying putting the true costs through the corporate P&L account and recognising the costs). Financial sector innovation is itself another form of capital misallocation, taxing people away from real innovation – (to keep the illusion alive, an ever greater percentage of economic output had to be allocated to this illusion machine) - helping add to the resource constraint we are in today.

If financial innovation, which we have so much of is not needed, what is the right kind? And why is it so sorely missing.

A lot of what are described as efficiency gains have been just the removal of levels of safety and the removal of innovation in the system. Innovation and ongoing operations are always and inevitably in conflict, with the most readily apparent conflict between short and long term priorities. A second handicap to innovation is the way efficiency is achieved by breaking down things into small repeatable tasks. This specialisation and repeatability is a company’s greatest strength, but it is also its greatest weakness. Innovation is neither repeatable nor predictable. It is non-routine and uncertain. (Book: The Other Side of Innovation).

The culprit: none other than the great moderation, and, now, ZIRP4EVA:

Low real interest rates support excessive consumption, taking money away from innovation and balance sheets. When the US started suffering from its peak oil in 1970, rather than innovation it turned to globalisation to tax the broader global resource balance sheet, just as Britain and Europe had done 100 years earlier through colonialism, and recently accelerated that with the WTO. Globalisation has always been about accessing resources.

Which bring us to topic #1 here, and everywhere else where economics is involved: cash flows.

This has been a factor mobilisation story on unprecedented proportions, but appears to have reached its conclusion as resource constraint has meant the “cash flow” to grease the wheels has started to become more expensive and constrained. Profit without productivity can only carry on for a finite period; we are now clearly consuming down our balance sheet or putting it through the P&L account.


So we are left with a massive amount of debt, a massive amount of capital and labour that is unprofitable in the world we face, and a balance sheet of insufficient resources to keep the illusion alive. The only thing that will get us out of this in the long run is innovation which will expand the balance sheet, expand the pie and create the jobs that people want.


How do we get rid of the debt? Are we in a debt trap whereby any interest rate hike will kill the recovery? Clearly it is going to be incredibly difficult, but low real rates are the cause of the problem, not the solution. I don’t personally see a  zero rate trap, but we need to allocate capital far more productively than we are doing.

The cost of money itself is hugely important. How negative were real rates? When people talk of borrowing from the future, surely the same logic applies to the cost of capital. If we have had low or negative rates that supported excessive consumption, we now need to have high real rates to direct capital back to innovation and gradually repair the balance sheet. The real cost of capital has to go up. No matter how much fighting the Fed and Treasury do, the real cost of capital will rise. The bond markets have to be allowed to clear some of the debt and thereby remove some of this misallocation of capital.

It's not "debt trap", it is "Fed trap"

Does that mean we are trapped in a position whereby the Fed cannot raise rates? Quite frankly it doesn’t really matter what the Fed does; real rates have to go up, are going up and will go up. The more the Fed and the government misallocate capital, the more the real cost of capital will have to rise higher to compensate. The only thing that will get real rates down is either a massive new discovery of incredibly cheap fossil fuels or the innovation that delivers cheap fusion. Otherwise it is a case of the cost of capital rising and causing demand destruction. 


Getting the central banks monetary policy inline with the real cost of capital in the market must be the first step to rectifying the misallocation of capital. One obvious thing would be for economists to stop ignoring CPI of food and energy as irrelevant as it is the fastest growing part of the economy. By ignoring it, they are turning what should be a smooth and relatively painless transfer of capital into an occasional out-of control collapse and transfer. Getting both a proper monetary and fiscal policy framework in place, based off genuine data rather than smoke and mirrors and fiddles must be the first priority. 

Which brings us to where we are now: a massive, unsustainable ponzi scheme:

Whilst politicians and investors acknowledge that excessive leverage created the asset and debt bubble, they do everything they can to prevent a rational deleveraging or efficient allocation of capital. For the moment the best measure of the cost of capital is gold. For years gold fell as fiat money was printed and this unsustainable ponzi scheme established, however as that ponzi scheme now unravels, gold must go up. The scale of both the ponzi scheme collapse and gold appreciation will be huge.


The problem is total credit market debt is still increasing. 


As Fitch recently highlighted, Chinese on & off balance sheet debt has expanded by nearly 40% GDP in each of the last 3 years. In other words, the misallocation of capital is continuing making the ultimate problem that much worse. China is now getting almost no growth per unit of additional debt. 


With each additional unit of debt, we are digging ourselves a deeper hole to get ourselves out of. Surely it is better to at least slow the digging? If we can allocate capital productively at the margin – (we know where we need to start making real returns) – then once we can start making a positive return on that marginal debt, then it becomes easier to support the residual debt we have.

If Andy is right, the framework of the next great class class conflict is set: it will be between the productive private economy and the "unproductive economy." Yes: Marxist tensions are about to make a repeat appearance:

Private sector annuity rates will be tumbling and yet the unproductive public sector are still being given great pensions. We are taxing the productive private economy to give to the unproductive economy. This has to end. The idea of a European fiscal union fills me with dread as that would be locking this unproductive transfer into stone. Rather than keep kicking the can down the road, lets own up to our excesses and start putting the economy back on track. Don’t reward the rioters in London with yet another handout; force them to pay for the damage they have caused and the police time they have consumed.

Is Greenspan to blame for this dead end? Yes... but only so far. One can just as readily blame the traditional duel between short and long-termism, or what is known better as "it will be the other administration's/generation's issue." In other words, Washington is just as guilty as Wall Street, and that infamous private bank.

Why have we misallocated capital for so long? We can blame it on democracy, but bigger than democracy is the culture that forces politicians to favour the immediate status quo over the longer term good of the country. That culture then presumably comes down to poor understanding which comes back to low levels of education. We need to address these route courses.

His conclusion:

The real cost of capital has to rise. That will happen through default in one way or another. Debt has to be cleared. Multiple contraction is inevitable.


Financial sector innovation has to be squeezed by engineering and scientific innovation. Until the debt is cleared and capital starts to be properly allocated, economic growth per unit of additional debt will continue to sour.


Energy is the cash flow in this story. Until we get some real breakthrough technology, requiring large amounts of capital to both innovate and then roll out, we have no chance of supporting the economy.

Nothing can be added to this.

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inkarri9's picture

The minutes from the FOMC release say something along the lines of "inflation moderating later this year".  Let's assume for a minute that Ben & Co. know that QE caused food and energy to rise....would anyone else assume that maybe they don't want to QE anymore?  Just a thought that came to mind.

Highrev's picture

Posted this yesterday or the day before.

Looks like someone didn't see it. ;-O

And there's more out there for the objective journalist who wants to find it.

And no I'm not Obama in disguise.

Fukushima Sam's picture

That is a crappy article.

To begin with, the guy uses charts from the Department of Commerce and seems to think the data is unmanipulated.

Second, he makes the case that wage increases keep up with inflation, while failing to acknowledge that wage increases lag real inflation by years, which amounts to a hidden tax on the wage earners.

I'll stop there...

Harlequin001's picture

This seems an awfully long winded way of explaining that the problem is the value of the money.

Under a gold standard where banks can't print they must borrow to raise capital. If you borrow at 3% you must lend higher for a margin which means you must lend longer to get the return. If you've loaned the money for 25 years you can't return it to investors at call which the banks claim to do, otherwise they are exposed to the risk of a bust due to liquidity and the resulting forced sale of those same mortgages at a loss; a classic bank run.

They must keep sufficient on hand (say 10%) to pay withdrawals or they bust due to liquidity and yes, bank deposits viewed in this light are of similar risk to a venture capital investment. The problem is liquidity.

Under a fiat system the banks don't need to keep any reserves to pay withdrawals because they can borrow it. Now for every $10 they take in deposits they can loan $90, which is fine for home owners until the check is presented for payment to a bank that has only $10 in deposits with which to pay it. The problem is solvency. Enter TARP, because that's all that TARP was, the bailout of insolvent banks.

It gets better because the bailed out bank with now $90 in deposits can loan $810 in new mortgages and loans and the cycle repeats, but this time much, much bigger until the inevitable bust.

This system is going to bust, no doubt about that and the only safe haven is gold.

It will be taxed to oblivion before this is over...

trav7777's picture

The OP totally misses the point.

The reason real rates are so low is because there is just nothing to do that yields a higher rate.  Credit is a supply and demand product like any other.  If there is NO demand at 5%, the lenders cannot expect to lend at that rate.  The rate is dictated by the aggregate economicality of a particular currency regime.

This is how Japan has been at ZIRP for 20 years; there's nothing left really to do in Japan that yields more than that.  There's simply no demand for credit there at 1%

Harlequin001's picture

Trav, I disagree old stick, the reason rates are so low is that central banks will print sufficient new money to keep them there. I want to lend my money at 7% and the Fed says 'screw you, it's an election year and I want to lend lower to stimulate the economy and lend at 0-0.25%' and they'll print as much as they need to do it. The travesty is that the 'markets' will allow them to get away with it. A gold standard won't.

That's why in my view the idea that CB's set rates is illusory, temporary and wrong. Ultimately the markets will decide by demanding higher rates for risk.

'If there is NO demand at 5%, the lenders cannot expect to lend at that rate.' Correct but I would say that when incomes don't rise as was the case with the currency pegs then you can only either reduce rates artificially, which they did or lower prices, which they do through derivatives. Either way as people borrow more they reach their repayment limit from static wages and stop borrowing; at that point it doesn't matter what rates are, people won't or can't borrow any more. I could borrow in Japan and buy wheat, corn or gold but if you imply that the quality of Japanese credit is not worth buying and so demand for it is low then I would agree in part with that...

Snidley Whipsnae's picture

"It will be taxed to oblivion before this is over..."

Before people will allow a taxation to oblivion they will turn to smuggling and black markets to avoid confiscatory taxation.

So the government will have helped create a new class of criminals that were simply trying to protect their wealth.

Opression of this sort leads down theslippery slope toward revolution.

Harlequin001's picture

'Opression of this sort leads down theslippery slope toward revolution' - and execution.

History dictates that life is a constant battle between individuals and governments that want to take what's mine and give it to someone else for whatever reason...

Despite our lack of action to date we are all terrorists at heart. Government demands it...


Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Whenever I see an article or start listening to an interview wherein government data is sited,  I quit reading or log off because what is to follow is either based on ignorance or propaganda.   --Tuco

TruthInSunshine's picture

The New York Times rag has two front page articles tonight, where their 'journalists' or 'editorialists' openly endorse more aggressive moves on the part of the Fed to encourage risk taking by investors (i.e. not saving, but gambling savings in a very uncertain atmosphere) and to encourage high rates of inflation -

- which the New York Times openly acknowledges:

"A more aggressive strategy would be letting inflation rise above the Fed’s comfort level of 2 percent or so to, say, 4 percent. That could help the economy by easing the repayment of debt. "

Half-Measures From the Fed -

Here's the other gem of genius (/sarc/):

Its Forecast Dim, Fed Vows to Keep Rates Near Zero

"The Federal Reserve’s hope is that a showman’s gesture will spur investment and risk-taking."


I hope the New York Times fails, and is bought out of bankruptcy by Mad Magazine, and renamed the Full Retard Times. 

Didn't anyone ever tell them to "never go full retard?"

Robot Traders Mom's picture

@Fukushima & Tuco-I completely agree that government data is laughable at best. That being said, he implies that the puppet masters (the FED) have created a gigantic ponzi scheme and it is game over. The more people like Lees at UBS, Rosenburg when he was at Morgan/Merrill, etc, that come out and expose the bullshit we are living in, the better.

If one of you wrote an article about how shitty the economy is and said the unemployment rate is close to 10%, I wouldn't call it a "crappy article" just because you are using the fictional government number, if I agreed with the body of work.

Again, we need more people on our side. Especially those with a platform.

Think about it.

topcallingtroll's picture

I dont think we need "sides"

We just need to figure this shit out and frontrun it. Wherever it goes.

Spirit Of Truth's picture

This sort of blunt truth is undecipherable in the West even if plainly stated.

bigkahuna's picture

300 up - 500 down - 600 up


If you can front run that then you deserve the returns lol!

macholatte's picture

I wouldn't call it a "crappy article" just because you are using the fictional government number, if I agreed with the body of work.

If one is going to use those kinds of numbers, where do you get them if not from the guv'ment? If not using guv'ment numbers, don't you run the risk of your thesis getting derailed over an argument of the validity of the numbers?  Damned if you do and damned if you don't.

Everybody KNOWS something is wrong and not working properly. The whole planet began to come apart 3 days ago. The more people of influence who begin to speak up, the better. We can debate the numbers, we can question their conclusions, but the evidence is there for everyone to see.

But I was thinking of a way To multiply by ten, And always, in the answer, get The question back again.
Lewis Carroll

About astrology and palmistry: they are good because they make people vivid and full of possibilities. They are communism at its best. Everybody has a birthday and almost everybody has a palm.
Kurt Vonnegut


Fukushima Sam's picture

Actually, the crappy article I was talking about was linked in the post I replied to.  I thought Andy Lee was spot on.

narnia's picture

the author focuses on a symptom, not the cause.

we have a centrally managed system that dictates well over 50% of the products & services originated in the economy.  these intellectual politicians have circumvented the will of the people (the market) and arbitrarily decided we need tons of bombs to fight people in Asia & Africa, free pharmaceutical industry defined health care to everyone who votes no matter how bad their personal health decisions, retirement income indexed to inflation to everyone who votes no matter how much they contributed to the system, handouts to bail out every bad decision that involves pensions or heavy contributing banking interests, specially directed expenditures to every industry that calls its constituencies to vote or cuts a big enough check, over $12,000 per year per child dispensed to an education complex with a massive drop out rate & no real education, a crazy war on drugs which requires tons of prisons, commits a portion of our population to perpetual welfare or incarceration, and on and on.

debt is a symptom.  the taxation required to pay for all of this stuff is the cause. it's a hurdle that can no longer be cleared.

topcallingtroll's picture are kinda making central planning sound like a bad thing.

Harlequin001's picture

The State, and by that I mean all States need to be constrained to maintaining law and order and defense. All this welfare needs to go because we can't afford it.

Seer's picture

"All this welfare needs to go because we can't afford it."

And what of our "defense?" (seem to recall something about "no standing armies")

Harlequin001's picture

Not sure what you mean about 'no standing armies'?

Silver Dreamer's picture

A peaceful nation does not need a standing army, and standing armies are the greatest threat against the people.  Our founders did not want standing armies.  Our federal government has done a good job of hiding that fact from our past, but the Virginia Bill of Rights is an easy reminder.  Article 13:

That a well regulated militia, composed of the body of the people, trained to arms, is the proper, natural, and safe defence of a free state; that standing armies, in time of peace, should be avoided, as dangerous to liberty; and that, in all cases, the military should be under strict subordination to, and governed by, the civil power.

We the people are supposed to be the defensive army.  It's called the militia, and it is still current law.  Most people on this board are members whether they realized it or not:

All government welfare is theft, and it needs to stop.  I could not agree more there, but then I'd include VA, food stamps, and all of the rest.  There would be no exceptions.

Harlequin001's picture

Silver Dreamer, whilst I agree with your sentiment the simple reality is that no militia can withstand a well equipped standing army. No government can raise and justify the expense of expensive weapons systems (and wooden battleships were once the height of technology) without one which means that the militia is only ever defensive and can only maintain the status quo at best or lose, wear down the invaders through time and expense (possibly) and possibly overthrow before being beaten and invaded again. Just look at Afghanistan.

The only place I know with a well armed militia is Switzerland but I don't believe for one minute that the militia is the reason why it has not been invaded. That I believe is more to do with holding everyone else's money...

A peaceful nation has no defence against an aggressor with a standing army. As much as we might not like it another country with a standing army does, and whilst i don't object to paying for it I do object when it is stationed on foreign soil. That's not what its should be for. The simple reality is that countries need standing armies that should hone their skills in peacetime not only in battle skills but in providing that emergency assistance such as road building and other such infrastructure rebuilding as needed in emergencies. Army medics should be available to support civil services etc. An army on foreign soil is an abuse of political power.

Silver Dreamer's picture

If we were not using our federal forces to maintain a fascist empire, we wouldn't need a standing army however.  The militia would be better suited to perform those local functions you mentioned.  I'm against all federal welfare to include federal to state government welfare due to disasters.

Harlequin001's picture

A militia by definition is already employed in other normal day to day activities of earning a living to be available for disaster assistance.

What, to you then, is the function of government if it is not the defence of the realm?

Snidley Whipsnae's picture

Perhaps the troubles we now face are embeded in democracy itself?

"A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury. After that, the majority always votes for the candidate promising the most benefits with the result the democracy collapses because of the loose fiscal policy ensuing, always to be followed by a dictatorship, then a monarchy."  Elmer T. Peterson (often misattributed to Alexis de Tocqueville)


Lobbelt's picture

All I read is: "the free market barely managed to maintain productivity in the period leading up to now, which had moderate money printing. So surely it will be able to do the same with a massive amount of money printing and enduring capital misallocation" 

Maybe you should've read the blogpost first before posting the same article again. 

Alea Iactaest's picture

Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works. — John Stuart Mill

lunaticfringe's picture

A couple of missing ingedients there Obama. One of them is the tax bite. Taxes as a proportion of income have risen dramatically. Taxes on virtually everything. My true tax bite, takes every dollar I make, thru June each year. If my wages increase 300 percent but the tax bote increases 400%- how much have I made? These type of koom-by-ya articles always neglect key ingredoents like the horrific tax bite, the horrific insurance bite across the board, and things that have risen like helath care costs well beyond that of standard CPI.

I paid 75 dollars for a crown in 1979. In 2009, I paid 1100. Get it? I shoulda got a gold one. I could sell it.

cacho's picture

you spend less on food because no one in America works to make that food and its imported, if all the food were to be manufactured in the states as the early years you pointed out, you would be spending far more than 80% on housing, food and clothing. Because the US printed money that the rest of the world tought it had real value is why your salary goes further today than 60 years ago...

gammab0y's picture

Convenient that the list of products included appliances, et al.  that have become dramatically cheaper to produce thanks to robotics.

How about a list with housing, higher education, and other more significant costs than a toaster.  I don't think the comparison would look so rosy.

Dick Fitz's picture


Tim@SeekingAlpha is missing the most important issue in his analysis- the US, by virtue of its reserve currency status, has been able to export the gross majority of its inflation to China/Japan/Everywhere else due to the "risk less" nature of the dollar. That day is ending. Once the dollar is no longer needed to settle oil payments, and the risk of US debt is recognized, that exported inflation will roar back with a mighty vengeance. Less than half of the US debt is held internally, and in many developing countries the US dollar is used as a means of transaction. Once that debt is dumped, the pressure on the US will undoubtedly increase dramatically.

Just my humble analysis.

Fish Gone Bad's picture

I am absolutely at a loss at why anyone actually thinks this administration (or any other) actually wants any innovation.  There have been quite a few really good ideas that came out over the last few years and ZERO came of them.  Anyone remember T Boone Pickens idea to build massive wind farms across the US with all the needed cabling?  That would employ millions of Americans.  How about Purdue's yeast that makes ethanol from cellulose (wood fiber).  The entire automotive industry could run on all the alcohol that that microbe could produce. 

America does not want innovation.  It wants the status quo.

Kat's picture

Yeah, what could be better than going further into debt to subsidize unprofitable windfarms while T Boone lines his pockets and people are employed to destroy wealth.  Swell idea.

How about just getting the regulators and the tax collectors out of people's effing way?  There are tons of people who have lots of great ideas that the government prevents from coming to fruition by pouring sand in the gears of anyone stupid enough to be productive.  Risk requires reward and the politicians' sole purpose in life is to rob people of it so they can line their own pockets and the pockets of rent seeking cronies like T Boone.

America wants innovation, Gone Bad. But, innovation requires leaving people be and not threatening them with Dudd-Frank, Obamacare, EPA, SEC, etc. etc. The politicians want the status quo because it's easier to consolidate and monetize their power.  Politics is just a futures market in stolen goods and the politicians love the goods they steal from you.

Tuco Benedicto Pacifico Juan Maria Ramirez's picture

Well said.  Early in the last century in rural Oklahoma on occasion tax collectors "revenuers" would come around and then simply disappear.  Apparently, when it came to government careers some of their employees "chose poorly".


CompassionateFascist's picture

More recently a revenuer was found hung somewhere in Appalachia; alas, it was apparently a suicide.

Fukushima Sam's picture

Like the article says, we really need an energy innovation.  Maybe we could make something up and pretend like it makes cheap energy, similar to the pretend and extend we do these days with the economy!

Oh wait, we already did this with nuclear fission...

Harlequin001's picture

alternatively is you killed half the people you wouldn't need that much energy...

Just sayin'...

Kat's picture

Fukushima,  We always need more innovation in everything.  Singling out energy is silly.

What if the innovation is not in energy but in a product that results in lower demand for hydrocarbons?  That would be just as good. 

That's why I don't support governments diverting risk capital away from the millions of investors searching out and seeking to profit from a new killer app and into whatever one top-down program the politically motivated monkeys in government decide should be the next killer app. 

Even if government can overcome the knowledge problem (it can't), the money doled out by government is doled out not to the best risk but by political fiat.

aerojet's picture

You forgot the fucking TSA!  I hate those dipshits so damn much!  I was in the Cincinnati airport yesterday--about ten travelers and 50 fucking TSA blue shirts standing around with their dicks in their hands.  And those lousy fucking naked body scanners.  They represent everything that is wrong with the USA right now--too many useless government workers, too many companies getting huge deals for unnecessary and over-complicated equipment that is only sold to the government via no-bid contracts. 

Poor Grogman's picture

Exactly, and because they are Soooo popular in USA they will soon be appearing in Australia!

Obviously to prevent the terrorists (Convicts???) from escaping LOL :)

You cant make this shit up...


Seer's picture

If you believe this then you have to explain all the innovations in the "defense" sector (which is target to the "defense" sector).  NOTE: TPTB love this shit because it keeps THEM in power! (see, it's not all that hard to figure out the CORE drivers in all of this!)

Wanting or not wanting innovation has NOTHING to do with it!  ALL that matters is keeping TPTB in power, that's ALL!  If they can do so via "innovation" then that's what they will do.

Badabing's picture

QE Stealth?


So what’s to stop TPTB from slipping in QE in on the sly? You must admit, the markets today are reacting just like we’ve seen with the bailout, TARP, QE and all the black hole fiat dumping the past history of this end game has taught us. Gold gets hammered $55 in seconds on the NY close, the Dow surges at the close to +429, Nasdaq +113, S&P +53.07! While the sheep herders at the MSM spins the notion that it’s because ZERO% interest will last years more? I don’t believe it for a NY second! The rules change at any  cost. What do you think? Is it possible that the tax payers get fucked without even knowing it?   

Tuco Benedicto Pacifico Juan Maria Ramirez's picture

"Is it possible that the tax payers get fucked without even knowing it?


Yes, it's called inflation and 95% of American have no clue!     Tuco  

andybev01's picture

The TBTF-PTB could be on live HDTV, cavorting around naked on a mink-lined stage on the backs of white lions, tossing bricks of gold and bags of cash back and forth to each other screaming to the audience in plain english excactly how they plan on eating your children , and the viewing public would click away to see what else looked interesting.







Yes_Questions's picture





New acronym?


"TPTB are because TAPDNC"