"The Truth Gets Out Eventually"

Tyler Durden's picture

Some look at today's FaceBook IPO flop, the ongoing market rout, and the situation in Europe with disenchantment and disappointment. We, on the other hand, view it with hope: because more than anything, the events of the past few days show that the truth is getting out - the truth that capital markets simply can not exist under the authoritarian rule of central planners, the truth that the stock market is a casino in which the best one can hope for a quick flip, and finally the truth that our entire socio-economic regime, whose existence has been predicated by borrowing from the uncreated wealth of the future, and where accumulated debt could be wiped out at the flip of a switch if things go wrong in the process obliterating the welfare of billions (of less than 1%ers), is one big lie.

We believe that hope is what SocGen's Dylan Grice is what he has in mind when he penned the following conclusion to his most recent piece: La Grande Illusion.

Since the crisis broke in 2008, the Fed and BoE have printed enough money to buy over 60% of the issuance of their respective government securities since. It makes you wonder. What would bond yields in the US and the UK look like without these purchases? Probably like those in the eurozone periphery. Indeed, maybe the euro debacle could have been completely avoided if the ECB had been headed up by a Ben von Bernanke, or a Mervyn Le Roi. Maybe that’s why so many of my friends agree with Atlantic magazine, which praised Ben Bernanke for ‘masterfully navigating’ the financial crisis and avoiding another depression.


Maybe all the Anglo-Saxon central banks have done is create the illusion that our sovereigns are more solvent than they are, and that our budget constraints are really a safe distance away.


But I don’t think they are. And I think the truth gets out eventually. The Enrons, the Allied Capitals, the Bernie Madoffs … they all get their comeuppance. Indeed, it’s what’s happening today in the eurozone. The accounting shenanigans eurozone governments resorted to in order to meet the entry criteria have been found out. Or at least, current CDS prices correlate well with countries’ cumulative deficit manipulations in the run-up to monetary union, as estimated by Paul van den Noord and Vincent Koen at the OECD. You can’t escape your budget constraint with financial gimmickry. You can just make it look like you have for a while.


Because if there is at least one thing the central planners of the status quo do not have control over, it is just that: hope.

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jonjon831983's picture

Illusion or willful blindness by the masses who fear the truth?

The Navigator's picture

aided by the MSM that won't tell the truth

Chris Jusset's picture

The "truth."  All we ask for is the truth.

X.inf.capt's picture

the avg. sheeple CANT HANDLE THE TRUTH...


Michael's picture

And at this point in time I would like to add, the presidency of the United States is virtually irrelevant.

You better prepare accordingly.

Quirey, If the Federal Government shuts down the Internet, how much will Facebook be worth?

aerojet's picture

You don't understand the Internet.  There's no chance the government could just "shut it down" and that's not because of how things are designed but rather how every business in the nation relies on it one way or another.  The furthest they can go is to shut down certain sites (like ZH, I suppose).  But that's it.  Anything more and they would be pulling out the last stop to armageddon. 

AldousHuxley's picture

why would government shut down the grestest information spying tool?


That's like saying government would shut down telephone networks.


Government doesn't want you communicating in person. Big Brother want to listen in on the conversation. It drives power from such privilege.

Ancona's picture

The only relevant thing right now is how much gold is there.......really?

Winston Churchill's picture

The only relevant thing right now is how much tungsten is there.............really?

AldousHuxley's picture

Word spell checker has made me a bad speller

Guess what Facebook's social apps are going to do to society....

Oh regional Indian's picture

Good Grief, Hope? hope?

mmmmm....hope, truth, love, family....mmmmmmmmm


Michael's picture

I just want to let you all  know I was Banned from Facebook in 2007 during the first Ron Paul campaign for political speech.

I've enjoyed my relationship with Facebook ever since.

I wonder if there's a banned Facebook users club?

cossack55's picture

Yes, they meet on MySpace.

NoClueSneaker's picture

Me member in 20 of such clubs - all of them very democratic and pro "free speech". :-O

Never bitched too much, always a fan of fundamentals. Me dumb :-P

lynnybee's picture

 "I just want to let you all know I was Banned from Facebook in 2007 during the first Ron Paul campaign for political speech." , 

badge of honor, Michael, badge of honor.   

btechtrader's picture

They have made me a stronger speller. If you pay attention to the corrections being made you tend not to repeat them in the future.

Interesting perspective though

tenpanhandle's picture

I knew he was talking derivatives.

Politeyx's picture

The only relevant thing right now is how much ammo you have.

Spirit Of Truth's picture

We can evade reality, but we cannot evade the consequences of evading reality." - Ayn Rand

I'm afraid time's up...

OldPhart's picture

ammo, food water, medical supply, like minded spirits nearby, three inch steel walls, doors and roofs, strategic claymores...the list goes on and on

Stack Trace's picture

Secret meeting at my house tonight! Bring the beer, tin-foil hats, and extra whiskey... we are going to need it. Leave your cell-phones and other electronic devices at the door with the chimpanzee Bo-bo. You will know who he is because he sports a large gold tooth and 4 pounds of silver bling hanging from his thing.

toady's picture

Cell phone at the door!

You better not bring one of those tracking devices closer than 10 miles from my door!

OldPhart's picture

Just pop the damned battery out.  Jeezus, they can't track you without parasitic power, can they?

toady's picture

Yep, that's what most people do.

Now my son says he can' t take the battery out of his icrap or it will void the warrenty.

I tell him to leave the icrap at home then.

EFNuttin's picture

TorProject website will provide a "tinfoil" browser for the web. Just be ready for geographically-oriented ads for each proxy from which you randomly browse.

TheGardener's picture

Can Tor still be trusted ? Not yet been taken over and used as a honeypot for suspicious traffic ?

CH1's picture

Tor requires that you know what you're doing.

It works, but it is not for amateurs. (But yes, there are lots of feds playing games with it.)

RiverRoad's picture

It must be a real knee-slapper for them....reading us.

gwiss's picture

Horse Hockey.  You think for one instant that if TPTB thought that the internet was in some way threatening their hold on power they wouldn't justify pulling the plug for "national security"?  There is no higher priority than national security, because that represents holding on to their power.  They will forcibly send others to die through the draft to expand it and gut whatever higher principles our country supposedly stands for to protect that power from erosion.  If there was any uprising that used the web to help organize, they would blink it off without a moments hesitation.

The trouble is how the internet is designed, not just here, but everywhere.  Data needs to run through trunks, and those concentrations of data are ridiculously easy to control.  There has been no success with creating local subversive internets from suitcase routers in tightly controlled countries because these still need access to the web through the country connections in order to be useful, and these country level connections are tightly controlled.  If one was able to develop a distributed routing system without central pipes that also allowed distributed access to many main nodes outside the country, then that has the possibility of robust independence, but such a system hasn't been created yet because such access nodes are hardware based and you can't shield the hardware.  Even projects like Tor still depend on the trunks which are under tight control.

disabledvet's picture

"democracy is not a suicide pact." there ARE higher priorities than national security...there's REAL security called "respect for one's personal space." Think your daughter likes your wife traipsing around in her bedroom to "just because"? Hehehehehe. "distribute that" i say. The Cloud is the answer...they have a vested interest in protecting your data...your personal space...since "they have a vested interest in protecting personal data" PERIOD. Go ahead..."access that Cloud." Does it even exist?

PaJoad's picture

If the gov't can shut all the banks for a holiday I don't think they will care about hurting business by shutting down the Internet. Whether they can or not isn't my question: I want to know how we're going to get our info from ZH if they shut ZH down?!! Tyler, what's the back up plan to get info distributed? Fax? Throw me a rope!

Terminus C's picture

If/when they shut down ZH you will no longer need ZH... You should already know what to do when THAT time comes. If you do not then you haven't been comprehending the message of this site.

However, I doubt ZH will ever be shut down as it will be used to gather information and as a distraction/misinformation hub, if it ever came to THAT.

Jake88's picture

That's true last stop to armageddon.  We are so dependent upon it that any disaster (for instance solar flare) that shuts it down will send us back to the stone age.

narnia's picture

Bank holidays, internet shut downs, rolling black outs- they're coming to a theater near you.

There's no such thing as a free lunch, in government borrowing or independence.

BigJim's picture

 Quirey, If the Federal Government shuts down the Internet, how much will Facebook be worth?

Don't worry, they won't shut it down completely!

You'll still be able to access all the important governmental stuff, like the Homeland Security 'I think my neighbor has gold' page.

Almost Solvent's picture

And order edible ipads with free next day delivery

Triple A's picture

The only site you will be able to go onto is Facebook. You better have a bunch of fake facebook friends.

Element's picture

Is there another kind?

Freddie's picture

All of TV is there to lie and manipulate the sheep.   We all love the islamic teleprompter.  If you watch TV - you enable them.

AldousHuxley's picture

David Choe, graffiti artist who made a film about hitchiking across America is now worth $250,000,000+ (almost as much as youtube founders) because he opted for FB stock instead of $60k for some paint job in Palo Alto.




That's the truth of how wealth is created....pure luck.


meritocracy my ass.


Likstane's picture

Good for David Choe.  Was it "luck" or foresight to opt for FB stock that enriched David Choe?  Sounds like the same God who brings thunderstorms also brings lots of FRN's to David Choe.  What status or wealth do you "merit"?

Huxley was just another stoner.

Calmyourself's picture

Shh, this huxley is convinced of his profundity..

Meremortal's picture

"That's the truth of how wealth is created....pure luck."

And your one example proves it!

Not everyone in the world has to be a failure because you are one. Most wealthy people earned their wealth through decades of hard work. This fellow was lucky? sounds like he made his own luck. He's a very successful investor, at least for the moment. There's nothing wrong with that, you should try it sometime.





Spastica Rex's picture

Some wealthy people worked hard for their wealth.

Some wealthy people didn't work hard for their weath.

Some poor people work hard.

Some poor people don't.


What's your point, again?

AldousHuxley's picture

hope is how old money keeps the slaves enslaved.


let one luck slave get rich and all other slaves will keep being slaves.


Hitler worked hard. hard work as nothing do with good work or beneficial work.


When luck is what determines outcomes, who the hell wants to work hard? just go to wall st. and gamble. . .