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The US Deleveraging Is Now Over

Tyler Durden's picture


Today the Fed released its quarterly Flow of Funds report, also known as the Z.1., which is mostly tracked to show quarterly changes in consumer net worth (and which we find far more valuable to show changes in shadow banking liabilities - more in that in a later post). So while in Q4 household net worth did increase by $1.2 trillion to $58.5 trillion, all of this change, and then some, was purely driven by the central bank induced ramp in the stock market: $1.3 trillion of the $1.2 trillion increase in Net Worth was from the change of value in equity shares at market value which at December 31 was $17.3 trillion. In other words, the illusion of wealth is and continues to be merely a iCTRL+P keystroke away. Yet the one finding that is truly surprising is that in Q4 for the first time since Q1 2008, debt across all holder classes increased: debt held by Households, Nonfinancial corporate business, nonfinancial noncorporate business, state and local governments and of course the Federal government, all rose in the quarter. In other words, the US deleveraging is now over as everyone adds debt for the first time since before the crash. The credit bubble is now officially back.

Here is the sequential change in credit market debt for all domestic non-financial sectors:

And a chart showing the assets and liabilities of the US household since 2004.


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Thu, 03/08/2012 - 16:19 | 2237038 trav7777
trav7777's picture bubble, bitchez!!!

Thu, 03/08/2012 - 16:40 | 2237131 dwdollar
dwdollar's picture

That's so next crisis!!! Come on in, buy some equities!!! It's all good until it isn't, but don't worry... you'll have at least 50 nanoseconds to cash out when SHTF!!!

Thu, 03/08/2012 - 16:52 | 2237170 max2205
max2205's picture

awesome chart...asprin please

Thu, 03/08/2012 - 17:12 | 2237214 economics1996
economics1996's picture

Here is what ZH is talking about, total credit, all classes.[1][id]=TCMDO


Leveraged 3.51 to one.  A slight problem.

Including unfunded liabilities we are leveraged 7.7 to 1.

It was the Silent Generation and GI generation that supported the Ponzi scheme programs.  The baby boomers, 1946-64, were not born yet.


Thu, 03/08/2012 - 17:23 | 2237298 Ahmeexnal
Ahmeexnal's picture

Buying PMs and gun5 on credit.

r3v01u710n about to erupt!

Thu, 03/08/2012 - 17:48 | 2237399 Chupacabra-322
Chupacabra-322's picture

@ Ahmeexnal, thanks for the idea.  Going over to Brownell' right now and charging a bundle pack of 500 rds of .45acp.  Sweet.  NDAA my ass.  Come and get some.  +infinity. 

Fri, 03/09/2012 - 23:57 | 2242425 spiral_eyes
spiral_eyes's picture

"The credit bubble is now officially back."

Yeah. M2 keeps rising. Everything else doesn't. 

Thu, 03/08/2012 - 19:50 | 2237778 macholatte
macholatte's picture

Apparently the Fascists have shown the sheeple that the way to get ahead is to borrow as much as possible and not give a second thought to paying it back. Home underwater, no problem. Renegotiate a lower interest rate and some debt relief. Obama will give you the money. 

Oh, you paid off your mortgage & your credit card debt and you paid cash for those cloths and cars and TV's and stuff? Too bad Sucka!  No gubmint check for you.

Thu, 03/08/2012 - 17:36 | 2237348 Bastiat
Bastiat's picture

Wd like to look at that on a log scale -- only a few minutes to download the data and run it in Excel but no time.

Thu, 03/08/2012 - 17:23 | 2237299 Chariots of the Feds
Chariots of the Feds's picture

Nanoseconds is SO last week.  It's all about the sub-nanoseconds now, didn't you read the ZH article the other day?  /sarc

Thu, 03/08/2012 - 17:32 | 2237327 tarsubil
tarsubil's picture

In the 80s, there was Megadeath. In the 10s, we will have Picodeath.

Thu, 03/08/2012 - 19:33 | 2237720 GovtMediaLiars
GovtMediaLiars's picture

No such luck buddy. 50 whole nanoseconds? Dream on.

Welcome To Sub-Nanosecond Markets

Market Madness 



Thu, 03/08/2012 - 16:42 | 2237135 The trend is yo...
The trend is your friend's picture

its called interest on top of interest or compounding.  At 18.99% interest these idiots will never get out of debt.  Negative Amortization credit cards BITCHEZ...

Thu, 03/08/2012 - 16:41 | 2237136 Silver Bug
Silver Bug's picture

Happy days are back!!


I think not.

Thu, 03/08/2012 - 18:17 | 2237479 Spirit Of Truth
Spirit Of Truth's picture

"Mission accomplished!" - Ben Bernanke

Thu, 03/08/2012 - 20:09 | 2237839 blunderdog
blunderdog's picture

Well I for one am delighted that the deflationary threat has passed. 


Thu, 03/08/2012 - 16:20 | 2237044 Pairadimes
Pairadimes's picture

Who's gonna pay for this? You are! Get back to work!

Thu, 03/08/2012 - 16:26 | 2237071 SheepDog-One
SheepDog-One's picture

Not me, thats for damn sure. I cashed out of this clownshow ahead of time. My fellow americans, have fun getting ass raped at 20% interest the rest of your lives.

Thu, 03/08/2012 - 16:34 | 2237105 surf0766
surf0766's picture

The baby boomers should pay for it. !! They caused it !

Thu, 03/08/2012 - 16:42 | 2237133 JohnnyBriefcase
JohnnyBriefcase's picture

Watch what you say about boomers around here.


They were born knowing so much and they don't take kindly to critisism which may or may not be the reason why we are in this mess.

Thu, 03/08/2012 - 16:52 | 2237172 LowProfile
LowProfile's picture

Boy howdy!  Check out the comments here!

These fuckers are going to take the high hard one a la Deliverance, with no lube, or even a reacharound.

Thu, 03/08/2012 - 17:09 | 2237244 economics1996
economics1996's picture

It was the Silent Generation and GI generation that supported the Ponzi scheme programs.  The baby boomers, 1946-64, were not born yet.

You people are idiots sometimes.

Thu, 03/08/2012 - 17:17 | 2237274 LawsofPhysics
LawsofPhysics's picture

precisely, and how many had to be killed off to get the ponzi going?  Food for thought if you think it will keep going.

Thu, 03/08/2012 - 17:27 | 2237309 economics1996
economics1996's picture

The Ponzi scheme is over.  Bernanke is juggling and working hard to keep the balls in the air.  Sooner or later he will screw up.

 "I got a serious question for you, 'What the fuck are you doing?' This is not shit for you to be messin' with. Are you ready to hear something? I want you to see if this sounds familiar . . . Any time you try a decent crime, you got 50 ways you're gonna fuck up. If you think of 25 of them, then you're a genius . . . and you ain't no genius."

Thu, 03/08/2012 - 17:19 | 2237277 JohnnyBriefcase
JohnnyBriefcase's picture

Boomers were born into this system and seemed (still to this day) perfectly willing to go against all logic and reason and accumulate mass quantites of unsustainable debt that they will never be able to pay off and pass it off to the younger generations.

Or are they just really, really stupid and "didn't see this coming"?

Thu, 03/08/2012 - 17:23 | 2237300 economics1996
economics1996's picture

I saw it coming in 1983 when Reagan turned his back on the American people, raised SS taxes, cut the top rate, and fucked the next generation.

That was when I became a Libertarian.

Thu, 03/08/2012 - 17:33 | 2237329 LowProfile
LowProfile's picture

But...  But... Reagan said Libertarianism was the heart of the Republican party!


Thu, 03/08/2012 - 18:03 | 2237439 GeorgeHayduke
GeorgeHayduke's picture

And here I've been told by my Republican friends (all 3 of them) that Reagan was GOD! I've tried to explain that Reagan was the father of the borrow, spend and screw the next generation policy that the Republicans embraced since his disastrous 8 years in the White House. But all critical though goes out the window with these folks once the Gipper's name is invoked.

Thu, 03/08/2012 - 18:20 | 2237492 wee-weed up
wee-weed up's picture

I'd have to say Obama has Reagan beat by a mile when it comes to "borrow, spend and screw the next generation."

Thu, 03/08/2012 - 18:23 | 2237505 JohnnyBriefcase
JohnnyBriefcase's picture

Don't give that puppet credit. They have perfected distraction and consolidated the "free press".

TV is way way more engrossing to the average consumerbot now than it was back then.

Thu, 03/08/2012 - 18:28 | 2237516 GeorgeHayduke
GeorgeHayduke's picture

Oh, I'm not defending Demoncrats. Heck, even the Dems became Republican-lite, corporate butt kissers after Reagan and have used the same tactic. Both Parties (as if there are two) have been driving this bus toward the cliff at top speed for a few decades.

The problem is, we're approaching the cliff right about now, but most folks haven't been looking out the windows. In fact, we may already be off the cliff and flying in a slight arc toward the bottom. Gravity will help the acceleration down soon enough.

Thu, 03/08/2012 - 22:29 | 2238295 Quaderratic Probing
Quaderratic Probing's picture

Cliff no longer matters computers will set stock price to any value you name, legislate gold illegal (again). Call for outright 50% cut in USA debt if you don't like it you lose the right to any and all trade with US banks and companies.

Thu, 03/08/2012 - 18:03 | 2237447 vast-dom
vast-dom's picture

u meant libertarian moron.

Thu, 03/08/2012 - 17:34 | 2237332 Shizzmoney
Shizzmoney's picture

Most who ran poker websites in the poker world (despite bills passed like the UEIGA) are of the baby boomer generation, like Phil Hellmuth, and claimed he didn't see it Black Friday coming (despite his site cheating players).

Yes, they are THAT Stupid.

Thu, 03/08/2012 - 19:41 | 2237731 4horse
4horse's picture

whole countries condemned because of bankers

entire peoples cursed over corrupt pols
                                        all bought&sold

whole generations to be betrayed because you are a plant

a plant
sown chaos
from some marketing dept
planted here like a bug
to entrap crap. which you're good at
like your bosses, with the mind of a morass
altogether a bog, of like underlying aspen
let's guess: dieffenbachia



Fri, 03/09/2012 - 05:16 | 2238946 chindit13
chindit13's picture

When I look at the debt figures for student debt, and see that it now exceeds total credit card debt, I wonder just how far from the tree the young acorns fell, given that they have accumulated “mass quantities of unsustainable debt which they will never be able to repay“.  To make matters worse, even though the student debt cannot be extinguished through bankruptcy, the deadbeats make themselves easy to hunt down, since they are usually outside an AAPL store waiting for the latest iteration of a gimcrack of which they already own all previous iterations.  Add this to the new young “champions of freedom”, like private data retailers Facebook and Google, I see that topping whatever madness the Boomers created is going to be a piece of cake.

None of that describes you? What? Collectivism and generalization are only for others?

By the way, the biggest chunks of national debt have been wrung up quite recently. The voting age is 18.  If you are over 18, please accept your share of the guilt.

Fri, 03/09/2012 - 07:18 | 2239029 JohnnyBriefcase
JohnnyBriefcase's picture

Hmm I wonder where the younger generation learned their financial bad habits from.

If only their irresponsible parents had taught them a thing or two about responsibility.

Thu, 03/08/2012 - 17:21 | 2237283 dwdollar
dwdollar's picture

Right... I'm sure the obvious Ponzi that is SS was the main topic of conversation when the Boomers were partying and getting high in the 60s and 70s.

Thu, 03/08/2012 - 17:26 | 2237308 aerojet
aerojet's picture

I don't care what anyone says, drugs fuck up your brain permanently.

Thu, 03/08/2012 - 17:36 | 2237345 Shizzmoney
Shizzmoney's picture

As you pop advils, tylenols, pain killers, Zoloft/Prozac, and Cialis when you get home.

Thu, 03/08/2012 - 17:41 | 2237365 LowProfile
LowProfile's picture


I don't care what anyone says, drugs fuck up your brain permanently.

Boy howdy!  I took a long course of this shit and my brain hasn't been the same since.

Started reading all sorts of weird shit on Austrian Economics, Agorism, History, etc.

Get you some!

Thu, 03/08/2012 - 17:47 | 2237393 JohnnyBriefcase
JohnnyBriefcase's picture

You're no daisy.

You're no daisy at all!

Thu, 03/08/2012 - 23:57 | 2238450 TheFourthStooge-ing
TheFourthStooge-ing's picture

aerojet must have been a little bit high when he said:

I don't care what anyone says, drugs fuck up your brain permanently.

Really? If that's true, then why do I have to buy more weed when I run out?


Thu, 03/08/2012 - 17:25 | 2237303 LowProfile
LowProfile's picture


It was the Silent Generation and GI generation that supported the Ponzi scheme programs.  The baby boomers, 1946-64, were not born yet.

Yeah, but the Boomers are the only ones left, and they had a chance to turn it around, but they chose socialism/crony capitalism and empire.  So fuck 'em.

You people are idiots sometimes.

Key word being "sometimes.

Thu, 03/08/2012 - 17:30 | 2237313 The Man in Room Five
The Man in Room Five's picture

Allowing an evil system to continue is just as bad as starting it.

Thu, 03/08/2012 - 17:54 | 2237417 Uncle Remus
Uncle Remus's picture

That is debatable.

Thu, 03/08/2012 - 18:17 | 2237477 Bastiat
Bastiat's picture

Then why haven't YOU ended it?

Thu, 03/08/2012 - 18:29 | 2237513 JohnnyBriefcase
JohnnyBriefcase's picture

The people who are even aware of the system probably account for 5% of the population. Of that probably 1% would ever think of doing anything to actually change it and they would just get suicided as soon as they made their intentions known.


Thu, 03/08/2012 - 18:55 | 2237593 LowProfile
LowProfile's picture


Then why haven't YOU ended it?

Hey, Rome wasn't burnt in a day.

Thu, 03/08/2012 - 18:23 | 2237501 Thomas Jefferson
Thomas Jefferson's picture

Granted.  Generational warfare is useless.   That being said.  Its the boomers who are voting for ass clown 1 and ass clown 2.

Fri, 03/09/2012 - 01:26 | 2238603 ChrisFromMorningside
ChrisFromMorningside's picture

The Silent/GI Generation may have built the Ponzi car but the Baby Boomers drove that shit til the wheels came off.

Mon, 03/12/2012 - 16:44 | 2248418 mkkby
mkkby's picture

The federal reserve act (of treason) was 1913.  The ponzi was well established by then.  That's what they used as blackmail in exchange for a monopoly on our currency.

Thu, 03/08/2012 - 16:55 | 2237187 redpill
redpill's picture

In Virginia over 60% of voters under age 45 picked Ron Paul (73% of voters in their 30s!).  Romney still won.  Fuck 'em.


Thu, 03/08/2012 - 17:09 | 2237238 LowProfile
LowProfile's picture

Hate to break this to you, but they are fixing the elections

Thu, 03/08/2012 - 18:22 | 2237499 POpatriot
POpatriot's picture

Your video shows nothing interesting.  A random sample size of over 2,000 is more than enough to make projections off of.  it doesn't matter how large the overall pool of votes is as long as the sample is completely random.  A class in statistics might be helpful.  We use techniques like this in manufacturing all of the time to project scrap rates.  It doesn't prove the elections aren't rigged, but the logic from which you come to the conclusion that they are is completely false.

Mechanical Engineer  

Thu, 03/08/2012 - 18:45 | 2237562 Red Heeler
Red Heeler's picture

"A random sample size of over 2,000 is more than enough to make projections off of."

True. And while it's perfectly clear you're not an English major you must realize, being an awesome statistician, that if the party composing the statistical questionaire skews the sample, the survey is likely null and void. Knowing what we know about our present kleptocracy it is well within the realm of possibility, most would assert likely, that exit polling is just another method of manufacturing consent.

Or, as the saying goes, "There are three kinds of lies: lies, damned lies, and statistics.

Thu, 03/08/2012 - 20:14 | 2237851 POpatriot
POpatriot's picture

The WHOLE video focuses on the small percentage size of the sample pool and nothing about sample skew...what's your point.

Thu, 03/08/2012 - 18:53 | 2237587 Burnbright
Burnbright's picture

I would disagree, a sampling size of less than 1% is not sufficent to determine the outcome. Further more if you watched the whole video he goes into great detail how you can tell every news orginization is using the same polling data and calls elections early in states that only use electronic voting, the electronic voting being the main culprate. Secondly he goes over the fact other states that count ballots mysteriously have entire districts go missing from the process. 

Thu, 03/08/2012 - 20:24 | 2237875 POpatriot
POpatriot's picture

I'm sorry but you're completly wrong.

"The mathematics of probability proves the size of the population is irrelevant unless the size of the sample exceeds a few percent of the total population you are examining. This means that a sample of 500 people is equally useful in examining the opinions of a state of 15,000,000 as it would a city of 100,000."  

Thu, 03/08/2012 - 20:06 | 2237787 LowProfile
LowProfile's picture

Lol, you BLA BLA BLA something about statistics, when the video shows them CALLING THE VOTE BEFORE ANY RETURNS ARE IN!?

Please list any structures you have worked on so I know which ones to avoid.


Thu, 03/08/2012 - 20:18 | 2237861 POpatriot
POpatriot's picture

You're right statistics and math are soooo overated...   

Thu, 03/08/2012 - 21:32 | 2238114 superflyguy
superflyguy's picture

first smart thing you said :)

Fri, 03/09/2012 - 00:14 | 2238471 LowProfile
LowProfile's picture

Go back and re-read what I wrote YOU. DUMB. FUCK.

Thu, 03/08/2012 - 18:24 | 2237503 POpatriot
POpatriot's picture

So we've got about 20-30 years before we can turn this ship around.  I guess that is some hope.  Hopefully we don't get sunk long before that.

Thu, 03/08/2012 - 18:39 | 2237547 Thomas Jefferson
Thomas Jefferson's picture

You will be lucky if we make it through 2015.  Forget 20 years from now.

Thu, 03/08/2012 - 19:54 | 2237793 SystemsGuy
SystemsGuy's picture

2015-2025 before the SHTF if you subscribe to Strauss and Howe, with 2018-2020 being the period of highest instability, with a secular Depression with periodic bear market rallies prior to that. I'm guessing civil war, attempted coup d'etat or multiple regional secession attempts at about a 30%, 25% and 33% chance respectively by 2018. We get past 2025 and things begin to improve.

Thu, 03/08/2012 - 17:01 | 2237213 Thomas Jefferson
Thomas Jefferson's picture

Dont worry about Boomers.  Obamacare will finish them off early.  You think Im kidding?

Thu, 03/08/2012 - 17:51 | 2237406 LowProfile
LowProfile's picture


Watch what you say about boomers around here.

They were born knowing so much and they don't take kindly to critisism which may or may not be the reason why we are in this mess.

There once were some ZH Boomers,

Who hated on a libertarian doomer,

He didn't give one single fuck,

'Cause they're not done rollin' in the suck,

And will check out, not later, but sooner!

Thu, 03/08/2012 - 18:50 | 2237574 blindfaith
blindfaith's picture



"The baby boomers should pay for it. !! They caused it !"

Dear Surf0766,

no not correct, everyone contributed by buying all the crap from China that could fin in the car on any given day.  AND>>>You dear boy, signed up to a fake school owned and opperated by wall street and then thinking you are going to out smart your peers with a grand super dupper financial job, took out a loan from the same bankers.  Did you investigate the school, the loan, read the terms...of course not.  How many beers and I-toys did you buy on credit...and that car and those clothes?

Funny I don't see a baby boomer with a gun to your head, not Then or now.

Thu, 03/08/2012 - 20:01 | 2237811 GovtMediaLiars
GovtMediaLiars's picture



You get a thumbs down for this:

"The baby boomers should pay for it. !! They caused it !"

Dear Surf0766,

no not correct, everyone contributed by buying all the crap from China that could fin in the car on any given day.

But a thumbs up for this:

You dear boy, signed up to a fake school owned and opperated by wall street and then thinking you are going to out smart your peers with a grand super dupper financial job, took out a loan from the same bankers.  Did you investigate the school, the loan, read the terms...of course not.  How many beers and I-toys did you buy on credit...and that car and those clothes?

The boomers certainly did nothing right but how can I even begin to say with a straight face that my generational peers have done any better? They love Obama for gods sake. That says it all right there.


Market Madness Daily Recap - 3/8/12


Thu, 03/08/2012 - 16:54 | 2237189 Doña K
Doña K's picture


What if these people have no way out and they are loading up as a last resort and declare bankruptcy when they hit the brick wall of no credit?

How about all of us move assets overseas, load up on credit card and other debt and then have Obama bails us out?  

Thu, 03/08/2012 - 17:53 | 2237414 resurger
resurger's picture

Are you a CEO of some sort of a company?


Thu, 03/08/2012 - 19:32 | 2237712 Doña K
Doña K's picture

Each one of us could be or act as a company. Just get an LLC in Nevada, Wyoming, Texas or Florida and you are good to go. ($500)

Deduct deduct deduct....See your local CPA.

Thu, 03/08/2012 - 17:35 | 2237341 AbruptlyKawaii
AbruptlyKawaii's picture

mean while the city of trenton new jersey is out of toilet paper and las vegas gambling revenues are up 29%! #winthefuture #wecantwait #nuclearpowerisgreen


Thu, 03/08/2012 - 17:59 | 2237427 JohnnyBriefcase
JohnnyBriefcase's picture

All fun and games 'till the shit hits the...



I bet they have some dollars lying around they could use or is that illegal?

Thu, 03/08/2012 - 21:36 | 2238128 superflyguy
superflyguy's picture

it's because trenton is a shithole so they must have used up all the paper trying to clean it up

Thu, 03/08/2012 - 18:27 | 2237511 neidermeyer
neidermeyer's picture

Nothing like paying 20% on $4 gas FOREVER ... people will just buy gas , groceries and guns on the last credit card they have and then change their phone number..

Thu, 03/08/2012 - 17:09 | 2237242 AcidRastaHead
AcidRastaHead's picture

Don't worry, the government will bring in Corzine to 'vaporize' that debt.

Thu, 03/08/2012 - 17:19 | 2237282 10mm
10mm's picture

When 18.99% comes,im busted out.

Thu, 03/08/2012 - 17:46 | 2237387 vast-dom
vast-dom's picture

Precisely. TeH FeD is destorying the planet so let's LONG Bernank's MYOPIA and SHORT COMMON SENSE and TeH ConstitutioN.

I'd say FUCK THE FED but it's much worse than that.... 

Fri, 03/09/2012 - 01:22 | 2238593 ChrisFromMorningside
ChrisFromMorningside's picture

Who's going to pay for it? I know that regardless of who wins the war, the imperial-financier class or the plebes, labor camps will be part of the solution.

Thu, 03/08/2012 - 16:20 | 2237045 Schmuck Raker
Schmuck Raker's picture

Whitney Houston Lives!

Thu, 03/08/2012 - 16:29 | 2237083 Clueless Economist
Clueless Economist's picture

I thought that was Britney Houston that died?  Whitney Spears is still alive, I think.

Thu, 03/08/2012 - 16:27 | 2237046 CompassionateFascist
CompassionateFascist's picture

EZ'est way to judge this is the # of credit card offers one gets in the mail. Trending upward for several months now. In the larger sense, the current "improvement" being trumpeted by the MSM is precisely this latest gas bubble of debt passing thru the economic cloaca.   

Thu, 03/08/2012 - 16:56 | 2237175 Momauguin Joe
Momauguin Joe's picture

Or, who one see's at the bottle bottle redemption center. Used to be I'd only run into illegal Latin American migrant workers or good old Billie Buckets, an alcoholic Vietnam vet who rides a bicycle around town with a couple of milk crates bungee corded to the back of his bike. Billie is free man; free to piss on a tree in the town green, free to sleep in any of the dozens of foreclosed and 'abandoned" porperties around town. The man is a survivor and a great source of wisdom in these difficult times. Between his VA benefits, the disability payments and the bottle collecting, Billie gets by.

On a good day, Billie can collect upwards of $50-60 for food, booze, etc. Billie reports increasing frustration with the soccer moms who crowd up the redemption facility on weekends, stuffing the machines improperly, slowing down Billie's day. Some days, he's even pressed for time to get to the package store before closing time (8pm in CT).

Ran into Billie this past Saturday at the redemption Center. He pointed out a couple of white fellows, obviously out of place and in a hurry to get out before somebody saw them. Billy said these guys are attorneies who were "downsized" from a big firm downtown. In between advertising their services on craigslist, they too, collect empties and scrimp and safe. Still driving their Beemers, for the time being at least.


Thu, 03/08/2012 - 16:59 | 2237196 CompassionateFascist
CompassionateFascist's picture

Yes, recently I saw a femme lawyer acquaintance - still dressed to the 9s - picking thru a gas station garbage can.

Thu, 03/08/2012 - 17:42 | 2237369 Stares straight...
Stares straight ahead's picture

There is also a surge in easy credit at "point of provider" type businesses like auto mechanics, tire supply, medical providers, veterinarians, etc.  Someone at the counter offers to make a phone call when invoice is presented and the customer can be approved for that amount of credit instantly. In some cases it appears to be causing a bubble in the cost of services provided.

Here we go.

Thu, 03/08/2012 - 17:57 | 2237424 Uncle Remus
Uncle Remus's picture

credit card offers one gets in the mail

Shedder fodder.

Thu, 03/08/2012 - 16:21 | 2237049 Winston Churchill
Winston Churchill's picture


Thu, 03/08/2012 - 16:21 | 2237051 Dr. Engali
Dr. Engali's picture

It is just incredible to me how short the memory of the U.S. citizen is.

Thu, 03/08/2012 - 16:53 | 2237184 SeanJKerrigan
SeanJKerrigan's picture

Well to be fair, many have taken on increased debt because they have no choice.

Mon, 03/12/2012 - 16:56 | 2248474 mkkby
mkkby's picture

The smart debtor loads up on PMs, has a boating accident, then defaults on the card.  Not that I would ever do such a thing.

Thu, 03/08/2012 - 17:35 | 2237340 DosZap
DosZap's picture

Dr. Engali

3yrs of cutting back/without, is all they can stand.

Thu, 03/08/2012 - 16:23 | 2237052 TruthInSunshine
TruthInSunshine's picture

I may criticize and even despise The Bernank, but he has proven that if you don't give up, and keep trying, you can get people and entities to [be forced to] take on more debt [as a result of Bernank's own policies - that is highly imprudent at times like these], that only further hampers their ability to obtain economic freedom and their ability to become independent by growing their savings and their true wealth.

Jolly good rogering, Bernank!

Thu, 03/08/2012 - 16:24 | 2237064 SheepDog-One
SheepDog-One's picture

'Take on more debt' meaning 'We can only buy groceries and pay our bills by maxing out this here credit card'.

Thu, 03/08/2012 - 16:29 | 2237072 TruthInSunshine
TruthInSunshine's picture



"You may stive to save, but with these levers I control I can destroy whatever savings you strive for at a faster pace than you can act and adapt!"*

Sayeth the Bernank!

(Which ushers in more future deleveraging, ultimately, in a bigger cycle.)


*So long as one pledges allegiance to Federal Reserve Notes (aka BernankBananaBux).

Thu, 03/08/2012 - 17:01 | 2237211 Doña K
Doña K's picture

Savers can fight back some by buying a bit of oil stocks to cover energy inflation, plant gardens and buy a bit of gold and silver. All just to stay even.

There is no low risk investment now that I know.

Any ideas?

Thu, 03/08/2012 - 17:30 | 2237315 aerojet
aerojet's picture

None.  Well, almost none.  Used cars seem to have become appreciating assets to some degree...

Thu, 03/08/2012 - 17:51 | 2237409 PMakoi
PMakoi's picture

Scotch seems to have an excellent shelf life... until I touch any of it.

Thu, 03/08/2012 - 18:20 | 2237491 Thomas Jefferson
Thomas Jefferson's picture

Better off with solar panels if you are in a state with friendly SREC's.  Their is silver in those solar panels as well.

Thu, 03/08/2012 - 16:29 | 2237080 rosiescenario
rosiescenario's picture

I massively deleveraged last year thanks to a short sale. Today I am debt free.


I recommend others underwater on their mortgages do so, too. It was purely an economic decision.

Thu, 03/08/2012 - 16:47 | 2237152 MachoMan
MachoMan's picture

I'm not underwater, but I'll be pulling my equity out before the election...  and renting...  and that is the last of any debt remaining... 

Any future debt will be purely for incredibly conservative business endeavors and not consumption.

Thu, 03/08/2012 - 16:53 | 2237185 LowProfile
LowProfile's picture


Any future debt will be purely for incredibly conservative business endeavors

That's a contradiction in terms.

Thu, 03/08/2012 - 17:03 | 2237223 MachoMan
MachoMan's picture

only in textbooks... 

Thu, 03/08/2012 - 17:12 | 2237253 LowProfile
LowProfile's picture

Hope they were written pre 1913

Thu, 03/08/2012 - 16:45 | 2237149 economessed
economessed's picture

Why WOULDN'T everyone be doing this? It's not like we're ever going to pay it back. New iPads for everyone! Prosperity!

Thu, 03/08/2012 - 17:05 | 2237227 resurger
resurger's picture

WOOT! Am buying my F150 Ford truck tomorrow on my credit card .... Fuck it! Its about time i default on my liabilities

Thu, 03/08/2012 - 17:13 | 2237257 LowProfile
LowProfile's picture

Make sure you sell it for cash the next day, then take a trip to Vegas.

Yep, I lost it all your honor.  Got me a wicked gambling problem.  Nope, don't have anything to show for it.  I feel really bad, I do.

Thu, 03/08/2012 - 17:12 | 2237252 Yen Cross
Yen Cross's picture

+1 SheepDog. Don't forget that platinum"student loan" card either.

Thu, 03/08/2012 - 16:23 | 2237057 SheepDog-One
SheepDog-One's picture

As long as they keep the firehose at full blast shooting free money directly into the banks at 0%, what could possibly go wrong! All is WELL!

Thu, 03/08/2012 - 16:42 | 2237060 Dr. Engali
Dr. Engali's picture

 Wonder what Apple is going to do with all that cash? Apparently they aren't paying off the right people.

Thu, 03/08/2012 - 16:24 | 2237061 rosiescenario
rosiescenario's picture

When a home is foreclosed upon or is sold short a large chunk of debt disappears. I have heard a rumor that this might actually be happening. Should we add that disappearing debt back to the numbers shown above to perhaps get a better picture of the debt increase????


Granted I am not an economist, nor a pedophile, but I repeat myself.

Thu, 03/08/2012 - 16:24 | 2237063 Dermasolarapate...
Dermasolarapaterraphatrima's picture

Heck w this, I'm going to the Mall!

Thu, 03/08/2012 - 16:34 | 2237109 CrazyCooter
CrazyCooter's picture

I did that too, but all the store space was empty.



Thu, 03/08/2012 - 16:24 | 2237066 Ham-bone
Ham-bone's picture

no end to the printing...inflation a betcha.  Got PM's???

Thu, 03/08/2012 - 16:25 | 2237067 MsCreant
MsCreant's picture

Borrowing picks up = I feel good about the future

Borrowing picks up = I can't pay for today

Borrowing picks up = I think inflation is going to hit like a motherfucker and I am buying up all the basics I can, now.

Borrowing picks up = I believe they are going to have to forgive everyone's debt, so fuck it, I'm goanna get me some.

Borrowing picks up = I am doing my part to bring down this shit shack of a financial system


Thu, 03/08/2012 - 16:28 | 2237076 RockyRacoon
RockyRacoon's picture

No, Missy!   All is great.  See my glowing recommendations below.  Chin up girl!

Thu, 03/08/2012 - 16:31 | 2237095 MsCreant
MsCreant's picture

Rocky, if only everyone would get with the plan and borrow and buy shit, we could save the world! I see it all now... (fades off into bad Belladonna trip that will take 20 or 30 years to come out of, at which time everything is decimated).

Thu, 03/08/2012 - 17:44 | 2237375 tarsubil
tarsubil's picture

I got a 0% interest card for 15 months. The fucking thing is almost maxed out after a couple weeks and I have enough cash in the bank to pay it off. Why not? I even get 1% back. Yeah, you pay a premium when buying PMs with CCs but whatever.

Thu, 03/08/2012 - 16:29 | 2237082 nope-1004
nope-1004's picture

I kind of agree.


Thu, 03/08/2012 - 16:33 | 2237102 cocoablini
cocoablini's picture

If 2 and 3 happens then that's deflation-the money vaporizes into thin air(plus interest.)

No one I know buys 3 awashing machines, cars and crap because they think the dollar is hyperinflating. Saving is the reaction-unless you are buying PM's.

Bringing down the shitshack we call the US economy would entail default on a huge scale-and that's deflationary.

Thu, 03/08/2012 - 16:36 | 2237114 XitSam
XitSam's picture

"They" are working to have their debt forgiven.  Your debt to them will still need to be paid, by you or your children.

Thu, 03/08/2012 - 16:27 | 2237068 RockyRacoon
RockyRacoon's picture

Okay, move along, nothing to see here, folks.   All the machinations of the Fed have been successful and we can all go back to buying Chinacrap.   Add some nick-knacks to your shopping list!   Spend, spend, spend.    Ain't it glorious?!  Hallelujah.

Wipe your brows and get that shoulder to the wheel.   We've dodged the economic bullet.   All the 401k accounts will soon be in the black.   Easy retirement is secured.   The sheep can huddle in the glow of their 50 inch flat screens and know that all is well in the world.


Thu, 03/08/2012 - 16:31 | 2237077 Dr. Engali
Dr. Engali's picture

Don't you mean ....add some wrick- wracks to your shopping list?

Thu, 03/08/2012 - 16:28 | 2237079 MsCreant
MsCreant's picture

Interesting the folks in debt, who pay into retirement accounts, ain't it?

Thu, 03/08/2012 - 16:31 | 2237093 Dr. Engali
Dr. Engali's picture

Why not? They can't take your retirement account when you declare bankruptcy.

Thu, 03/08/2012 - 16:33 | 2237101 MsCreant
MsCreant's picture

Congress will take my retirement account when they declare bankruptcy. They did it in Argentina, and they have already discussed the idea in Congress. Seriously. 

Thu, 03/08/2012 - 16:37 | 2237116 Dr. Engali
Dr. Engali's picture

I know that's coming. That's why eventually it will be imperative to pay the penalty and buy precious metals.

Thu, 03/08/2012 - 16:50 | 2237163 MachoMan
MachoMan's picture

You just have to avoid boating accidents that render all your pm's gone...


Thu, 03/08/2012 - 17:16 | 2237263 LowProfile
LowProfile's picture

Or trips to Vegas that cause you to lose everything with nothing to show for it.


Thu, 03/08/2012 - 16:38 | 2237118 SheepDog-One
SheepDog-One's picture

Yep, the big target it everyones 401K and pensions and whatever else retirement accounts, make no mistake about it. And it will just be overnite when everyone is most placated, such as today when all is fixed and all is well. They dont care.

Thu, 03/08/2012 - 16:56 | 2237197 MachoMan
MachoMan's picture

It's basically a foot race though...  I strongly suspect baby boomers will be pulling the fucking hell out of everything they can get from those accounts...  simply as a natural mechanism of prolifigate spending... 

two whinos fighting over the last bottle.

Thu, 03/08/2012 - 17:16 | 2237270 LowProfile
LowProfile's picture


I strongly suspect baby boomers will be pulling the fucking hell out of everything they can get from those accounts...

Only the smart ones, so that's like...  5%?

Thu, 03/08/2012 - 18:05 | 2237450 JohnnyBriefcase
JohnnyBriefcase's picture

Oh snap!

+4 billion

Thu, 03/08/2012 - 18:10 | 2237465 MachoMan
MachoMan's picture

Well, it's not only the smart ones...  in this case, the incentives of the smart ones and fucktards alike are aligned...  which is destined for strangeness...  [the fucktards will be pulling out what little money is left to keep up their spending habits, etc., as inflation eats their alternative spending prowess].

It's kind of like indiana jones in the cave with the ball rolling down the corridor...  EVERYONE is gonna run when the ball is rolling down the corridor...  bennie is the ball roller.

Hopefully the spikes and ravines don't get us either.

Thu, 03/08/2012 - 17:20 | 2237278 RockyRacoon
RockyRacoon's picture

I cashed out my self-directed IRA account back in the 90s, took the hit, and moved on.  My accountant thought I was nuts -- and then we had the Nazz crash.   It was a beauty to behold.   Went hard into PMs at that time.   Anguishing over the POG at $400 is a fond memory.   A roll of $5 Gold Eagles (50 tenth ounce = 5 full ounces) at $2,200.  Silver American Eagles at $6 each was just too good to pass up.

Thu, 03/08/2012 - 17:35 | 2237339 MsCreant
MsCreant's picture

Nice work. Wish I had your insight back then. 

Thu, 03/08/2012 - 18:07 | 2237454 Thomas Jefferson
Thomas Jefferson's picture

Me too.  I was still fast asleep.  America Fuck Yeah!

Thu, 03/08/2012 - 18:09 | 2237464 Lost Wages
Lost Wages's picture

Better late than never, while we have some life left to live. Myself? I would have liked to wise up around 2005-2006 when my house was worth double what I paid for it, instead of half what I paid for it like it is now.

Thu, 03/08/2012 - 20:24 | 2237874 RockyRacoon
RockyRacoon's picture

I was a hog who found his acorn, Missy.  I ain't that smart.  Mostly the confluence of events more than perspicacity on my part.   That's when I started reading The Privateer as well.   That was the prime mover.   I was turned on to silver by a person who has since passed on -- but his legacy remains.   Just remember, one of these days that agonizing I'm doing over $40 silver will look quaint as well.   My lesson learned is:  Buy at any price!  The day to be afraid of the price will be apparent to all -- but that ain't today.

Thu, 03/08/2012 - 17:18 | 2237280 reload
reload's picture

Yup: THe Hon J Corzine will be Barry O's pensions and savings Czar in the next administration. Run, RUN, time IS running out.

Thu, 03/08/2012 - 18:02 | 2237438 Uncle Remus
Uncle Remus's picture

What are these "retirements" and "pensions" you speak of?

Thu, 03/08/2012 - 16:40 | 2237128 WillyGroper
WillyGroper's picture

Visions of pitchforks & torches.

Thu, 03/08/2012 - 16:42 | 2237141 Moneyswirth
Moneyswirth's picture

Yes.  Don't think it can happen here.

Congress has discussed this issue a few times actually.  Plans I read about were along the lines of "you're too stupid and reckless to own this wealth, therefore we will take control of it, and ensure you annual returns of 2%.  You're welcome, ingrate"

If Obama wins re-election, with no election to lie for, and God-forbid the Dems regain control of the House, then watch out.  Kiss your 401Ks bye-bye.


Thu, 03/08/2012 - 16:55 | 2237190 Thomas Jefferson
Thomas Jefferson's picture

People are awake!  At least on this website.   Try explaining that to the average 300lb American though.

Thu, 03/08/2012 - 17:17 | 2237275 LowProfile
LowProfile's picture

Sad thing is they probably have enough fat stored to last out the crisis.

...Going short liposuction clinics.

Thu, 03/08/2012 - 16:42 | 2237143 LawsofPhysics
LawsofPhysics's picture

Oh do tell.  Does congress plan on dis-arming the populace first?  Seems they might have overlooked something.

Thu, 03/08/2012 - 16:52 | 2237171 MsCreant
MsCreant's picture

They have gotten away with raising the debt level to where it is in both our names, without our consent. No armed revolt yet. They passed TARP and other bullshit so called bailout mechanisms, even though congress critters were getting calls 100 to 1, up to 300 to 1, against it.

I just don't know what it will take except outright, blatant, resource scarcity.

Thu, 03/08/2012 - 16:55 | 2237192 LowProfile
LowProfile's picture

Don't need an armed revolt.  Just enough people going "Ahhh...  Fuck it.".

Cash, barter, excess fiat goes into PMs...  Just a matter of time.

Thu, 03/08/2012 - 17:07 | 2237212 LawsofPhysics
LawsofPhysics's picture

There you go.  The game can only be played if there are players.  Want to see the future of America, look at India.  The majority of their economy is transacted "off the books".

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