The World Is Flat And Other Tales From Spain

Tyler Durden's picture

From Mark Grant, author of Out of the Box

The World is Flat and other Tales from Spain

“The very powerful and the very stupid have one thing in common. Instead of altering their views to fit the facts, they alter the facts to fit their views... which can be very uncomfortable if you happen to be one of the facts that needs altering.”


                                              -Dr. Who

The art/science of Deduction is a process that I engage in daily. To paraphrase Mr. Sherlock Holmes; it is where I make my bread and cheese. On the most fundamental of levels you must have the facts right before you can reach any conclusion or series of conclusions and here is where Europe tries its best to mislead you; they do not wish for you to have the correct data. I used to think it was just some political strategy of giving the public information but I now honestly believe that the Europeans engage in a very devious manipulated charade quite on purpose. It probably dates back to the Church claiming that the Earth was flat when it was heretical to disagree with the doctrine which was provided by Rome. The way the Spanish Prime Minister is behaving concerning the Spanish bailout he must still believe this heretical nonsense today. This week the bailout; next week the Inquisition.

"But as to the fable that there are Antipodes, that is to say, men on the opposite side of the earth, where the sun rises when it sets to us, men who walk with their feet opposite ours that is on no ground credible. And, indeed, it is not affirmed that this has been learned by historical knowledge, but by scientific conjecture, on the ground that the earth is suspended within the concavity of the sky, and that it has as much room on the one side of it as on the other: hence they say that the part that is beneath must also be inhabited. But they do not remark that, although it be supposed or scientifically demonstrated that the world is of a round and spherical form, yet it does not follow that the other side of the earth is bare of water; nor even, though it be bare, does it immediately follow that it is peopled."


                                             -St. Augustine

The Church may now recognize that the world is round but the attitude remains the same and it is still almost heretical to disagree with the numbers handed out by the new hierarchy; the European Union. They count what they wish to count, they add what they wish to add and when I count all of the numbers and not just those they wish me to count then I am branded an evil-doer making “mischievous comments” which is how the Irish characterized me at one point. It is no surprise I suppose, governments in peril will go to any length to preserve their own existence and the more they are under siege; the worse their behavior.

After the now humorous proclamations by Europe and the IMF that the austerity measures in Greece would bring the country to a 120% debt to GDP ratio the second most ludicrous claim was that the EFSF and then the ESM will ring fence the core countries in Europe. This notion was heralded by both the EU and the IMF and the concept was just as effective for keeping Spain out of trouble as the advice of Mr. Ponzi for making investments. Now Troubadour Rajoy of Spain sings that the bailout for Spain was “a great victory for Europe” one supposes that we have returned to the flat earth theory. Since neither of the stabilization funds were actually funded of course; contingent promises to pay, which seem to get counted and then counted again like votes under Mayor Daly of Chicago are once more in vogue. However now with Spain to actually receive $125 billion (a $26,400 debt for each and every person in Spain) in the first round of funding and I say the “first round” because the money is nowhere near adequate for their banks much less their regional debt no matter what nonsense Ms. Lagarde speaks these days as she follows the advice of Marie Antoinette, “Let them eat cake;” now someone has to come up with the cash. You may have noticed in your life as I have noticed in mine that promising to pay and actually paying are two very different things. You may have also noticed that actually paying lessens the amount of money that the payer has left which is just what the European nations are concerned about as their credit quality deteriorates as they cough up the cash. Funny how that works!

The EU notion of ring walls did absolutely nothing, as I long ago said it would not, because the economic decline happens from within and not from without. The EU attempted and failed to protect itself from a threat that did not really exist because economic deterioration happens because of fiscal and monetary policy and not real or perceived threats from real or perceived bond vigilantes. A coral may protect the horses from the wolves but it does nothing to keep the horses from getting sick and the horses are most assuredly sick.

For those of you that keep waiting for some giant change-the-world event; I invite you to re-gear your perspective. Greece has fallen, Portugal has fallen, Ireland has fallen and now Spain has followed the road into Purgatory. These are significant events that are, in fact, changing the world though none has caused Armageddon to date though they may by their aggregate but not singular importance. This is also why Greece is of such key importance; it has nothing to do with staying in or out of the Euro or of the preservation of the European Union as a political entity. That part of the equation is barely relevant. What is of critical importance though is that if they leave the Euro that they will default on some $1.3 trillion in total debt that can be afforded by no one. That is the rub and you may ignore the rest of the Eurospeak that is bandied about from Brussels to Berlin. A default by Greece will bankrupt and cause re-capitalization at the European Central Bank, it will throw the IMF into a tailspin and it will play havoc with Target2 and the German Central Bank. Do not allow yourself to be taken in and mis-directed; this is THE issue and the only issue of real importance.

Pay close attention, as well, to the method of funding. First the EFSF money because the ESM is not yet in existence and then the ESM money, if/when approved, to the Spanish FROB (Fund for Orderly Bank Restructuring) which is part of the Spanish Government. The ESM money then immediately subordinates not just Spain’s sovereign debt but any and all bank debt in Spain so that the senior debt of Bank Santander gets subordinated and the bank’s assets can be called upon just like the sovereign to repay the fund if necessary. Look at the fine print here; pretty frightening. Then the Regional Debt will come into play which will cause another round of funding for Spain and which will toss the country into the vice-grips of the Men in Black who will arrive in droves from Berlin and Paris. We are also about to confront a very angry Ireland, Portugal and Greece who will legitimately ask why Spain is being funded at 3.00% while they are penalized for their indiscretion in much more painful ways. The first reaction of the markets may well be that the Three Kings of the Orient have arrived to save the day and, if so, take advantage of it because like in times recently passed the daylight will soon dawn that the core countries, Spain represents 12% of the budget of the EU, has now been infected and the cancer has spread to the lymph nodes as the “great victory for Europe” becomes the severing of the coronary artery. Now it is just not that Spain had to be bailed out but the problem is squared as Spain can no longer afford to pay to help the rest of the periphery nations.

“Hemmed in by the Americans and the Russians in the final days of World War II, Hitler convinced himself that he had two armies in reserve to mount a counter-attack and win the war.


Meanwhile, having lost the entire Pacific, Japan's Imperial Cabinet believed that no enemy could set foot upon the country's sacred soil.


When the truth is unimaginable, human psychology finds an alternative reality in which to dwell.”



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krispkritter's picture

The World is Fiat?

Colombian Gringo's picture

No, Spaniards are flat, flat broke.

Peter Pan's picture

My definition of wealth is to ask yourself what you would have left if all your debtors refused to pay you and you hold no physical security from these debtors. On this basis anyone who has lent to Europe or her banks surely qualifies for food stamps.

If your wealth is based on trust, you should already have broken out into a cold sweat.

fiercekitty's picture

It's funny, when I first looked at this headline, that's how it appeared to me: "The World is FIAT"!

ThirdWorldDude's picture

It's a FIAT 500


Kinda funny when you realise they are next in the cue...  :)

phungus_mungus's picture

Italian and Spanish 10 years are headed to low earth orbit as I type...

Burn bitch, burn!!!!!!!

Morphine Drip's picture

The moon is made of cheese


There are little green men on mars


Those titties are real


and banks are well capitalized

JohnG's picture



I'm from the government and I'm here to help.

Ghordius's picture

take me to your leader, I heard there is intelligence on this planet

piliage's picture

But...but...I thought they had solved everything today...? It must be true because Junker said so.

Question: If you kick a can far enough, does it eventually come back around and hit you in the ass?

fiercekitty's picture

Yes, when you kick it all the way around the world.  Seems like they are almost there.  Haha.

Poor Grogman's picture

Never having lived through an economic depression, Its good to have a forum where one can analyze this event with other folks in real time.
Great work ZH.

timbo_em's picture

Spanish 10-year bond took a V-shaped recovery this morning. That's a good sign, right? Oh and the ESTX Banks after a strong opening at 89 only went south to 86.

Looks like some guys out there had a tough weekend and needed some time to go through this stuff.

THE DOCTOR's picture

What's the capital of spain?....3 euro

dead hobo's picture

Things I wish I wrote. 2 atta-boys and a 100 euro savings bond, maturity 2032. Congrats.

Byte Me's picture

(a $26,400 debt for each and every person in Spain

Clearly Spain only has 5 million inhabitants for the purposes of this post

Get your DP in the right place Mr Grant.

jannewmx's picture

Perhaps he divided the number with only the people working in Spain.

Byte Me's picture

Could be.

But he still should get the maths right.

hedgehog9999's picture

In order for your post to be credible GET YOUR FACTS RIGHT!!!

You said: "However now with Spain to actually receive $125 billion (a $26,400 debt for each and every person in Spain)"


You inflated the per capita debt in Spain 10 times over, the correct number is $2,640/capita.!!!!! not $26,400,  you obfuscate this even more.....!!!

Based in this, the earth is a flat triangle that curves at the edges.

ThirdWorldDude's picture

Don't get upset, Mark is only acting according to his favorite Dr. Who quote.

Peter Pan's picture

LOL. Point taken but give the author a break. He may still be proven right by the time they finish bailing out Spain. And maybe it is already that figure if you factor in unfunded liabilities.

hedgehog9999's picture

Understood, and I mostly agree with the author, sometimes you really wonder when the basic numbers are wrong. It is important to get the right number of zeroes now that we deal in these ginormous numbers.....

GCT's picture

Great read this morning and the markets are green.  What a crazy world we live in.  Thanks ZH.  Looks like they will take the investors down the same road as they did with Greece.  In theend all the investors will get screwed.  Well all but the bonds from London that is!

newworldorder's picture

Let us consider the unthinkable.

A famous American once said that "deficits do not matter." Can it really be that simple? Can we contemplate that if deficits do not matter, then Soverein debt paid to its respective citizens, its employees and other sovereigns "does not matter."

As long as trust is maintained  in the full faith of "somebody," the interest on sovereign debt is paid and bond maturities are turned over, then the perception is that - all is well. Economic theory be damned, the majority of people on this planet do not know or could care less of economic theory.

InjuredThales's picture

Not to fact check Mr. Grant too much, but a $125,000,000,000 bailout is only a $2,739/person bailout.  $125x10^9/4.6*10^6.  So, we are talking an order of magnitude difference, but I suppose it's all relative.

dead hobo's picture

Mark Grant said:

What is of critical importance though is that if they leave the Euro that they will default on some $1.3 trillion in total debt that can be afforded by no one. That is the rub and you may ignore the rest of the Eurospeak that is bandied about from Brussels to Berlin. A default by Greece will bankrupt and cause re-capitalization at the European Central Bank, it will throw the IMF into a tailspin and it will play havoc with Target2 and the German Central Bank.


Thank you for noticing this too. The ECB has only 85 billion euros in capital, more or less. I wrote about their nightmare scenario elsewhere and was astonished about how few people understand the basic accounting equation Assets = Liabilities + Capital. If the ECB loses its capital due to Greek debt, then the ECB fails just like any other business fails. It can't just write itself a check for new stock, although most people probably think otherwise. Or they confuse assets with capital and don't understand the problem. The ECB will at least have to go through a straw man process of loaning new cash to member countries, getting collateral in return,  so they can round trip it back for new capital stock. Spain is just the warm up act. Will the collateral be junk European sovereign debt from other countries or Chinese assistance? This would be a hell of a Chinese opportunity to expand its commercial empire. Can they legally own ECB stock?


BeetleBailey's picture

"What is of critical importance though is that if they (Greece) leave the Euro that they will default on some $1.3 trillion in total debt that can be afforded by no one." debt, period?

Owed, to who(m) - (..........we including other items in this 1.3 trillion, like pensions and "filler")?

Hell, around 100 billion of Greece's debt is NATO defense purchases (mandated by treaty).....the US M.I.C. tapped them for 60 billion I read somewhere.....

Who(m) else? I'd like a list of the debtors (and the fools who own Greek debt/didn;t sell out long ago) sans the dog bond buyers/speculators.

BluePill's picture

I wish i could bone a german Frau today

hedgehog9999's picture

sorry to break this to you but it is up the greeks and spaniards to take take care of the fraus on their beaches while they themselves get boned by the Junges or careful out there with fraus

slewie the pi-rat's picture

holmesian 'logic' is not purely deductive(/indiuctive/intuitive) but is based upon the quality of the observations and the selection of same by the mind/intelligence/person

the intellect is spry and nimble, unlike the plodding watson who is trained in medical observation and methods, by contrast, and has not escaped his school and hands-on 'training'

sherlock, able to grasp the conditioning mechanisms, overcomes them somehow from this vantage point and frees his ability to see and feel, and integrate the impressions from a perspctive not limited by what is essentially white propaganda and white acculturating noise

he does not reject the white propwash;  he gets beyond it by working through its effects on his own mentation processes, one must conclude, since that is the 'only game in town' even now, right?

conan-doyle/sherlock solves the riddles b/c he is able to see them from a less-encumbered perspective;  then he can explain the logic which is no different from watson's and can be understood by him, but only after drWatson gets to see what sherlock was able to see from the get-go

in order to actually enter the gestalts, sherlock uses everything from disguises to bloodhounds, children, armed escorts on police boats, and his landlady's personality

he follows the public and diplomatic and shipping news like a hungry dog, constantly loading up for new perceptions and connections

how can he understand the different criminalities so deeply?  how can he size up the a situ or a person so well?  if all he does is eat and drink and get high and sleep and study and observe people & times and mentate and take what comes along, well,  what on earth kind of a life is that?  i guess one would hafta understand conan-doyle himself for that stuff;  the actual man who created the character from the stuff of paradox, itself...?

Peter K's picture

I think that the mind set is actually one of Soviet Russia. Facts are defined as true if they advance socialism, and falsehoods are those that retard socialism's advance. And since we are dealing with a bunch of European socialists, here is where the dog is buried. :)

PS Socialism es muerte.

falak pema's picture

your language is so deceptive; you call private oligarchy fascism, state socialism. Not true, but I agree with you that the same result today is potentially the outcome as in the past, as with government totalitarian shenanigans. 

Charybdis and Scylla of today's post-industrial world where money is king and the click of a mouse can start a tsunami and its an automated mouse at that; in HFT mode. 

But don't mix root causes in terms of who calls the shots. Plato said it all in his works way back then. Just shows, life is a circular game of eternal reset. 

falak pema's picture

and its ALL about private banks, since 2008; the government sector debt is in relative terms just peanuts in itself, but it is the ignition fuse to bigger global financial bang of unknown magnitude. 

blindman's picture

thanks for that.

Grand Supercycle's picture

Rally Warning from last week:

'Daily chart now gives bullish warning and significant
SPX rally & USDX retracement should commence in a week or so'

stiler's picture

Seeing that people misunderstand what "armageddon" is, shouldn't we go to the source of the word for a better take? No end of the world is immanent. The financial meltdown is not the beginning of 666. Armageddon is a misnomer, not the Bible's name for the time when all hell breaks loose and not the time of it; it should rather be called "the War of the Great Day of God Almighty", when he treads the grapes of his wrath (armageddon is merely the name of the place where the gentile nations of the world convene their forces to annilate Israel).

'Mine eyes have seen the coming of the glory of the LORD;

He is trampling out the vintage where his grapes of wrath are stored"

That's God's Messiah returning and trampling the gentile nations in vengence and wrath for their antisemitism. The Civil War was traumatic enough that they thought it was the end, too. The War of that Great Day is future.... "the Great Day", by the way, refers to a week of days, or sevens: 7 years of tribulation, the second half of which (3.5 yrs) is the time when no one will be able to buy or sell without the Mark.

This economic shaking is a warning.

Psalm 2 "...kiss the Son, lest He become angry and you perish from the way..."

zapdude's picture

I agree.  Two questions for you:

  1. Do you believe in a pre-trib or post-trib rapture? 
  2. What is the next eschatological sign you're looking for?

Me, I'm a post-trib, which means I should be more of a prepper/survivalist than I actually am. 

However, I believe we should focus much more on our spiritual preparations (ourselves, others) than the physical provisions -- not many Christians are going to make it out alive when it all goes down.


stiler's picture


Blessings my brother. It is truly good to hear from you on Zerofaith. Yes, I am pretrib and I think his coming for his own is very close. 

Can any preparations change the enevitable? People have no idea of the cataclysms that will happen. And it is all meant to bring people to God, yet they run from God. We need to tell others about Messiah Jesus. 

I'm looking at anyone of these signs before the rapture of the church: the transformation of the "Roman" Empire from the east-west balance of power to the one world gov't stage (then 10 kingdoms, then Antichrist), the revealing of his name, and the first of five total blackouts of the sun for a short period. The signs will become more and more intense, like the labor pangs of a woman. But we shouldn't judge these things by newspaper or internet headlines, but only by the bible, because they are very precise in their fulfillment being from the jewish prophets. Read vthe Bible. Here's someone to study by;

click "Come and See"

zapdude's picture

Haha, ZeroFaith.  While very informative and entertaining, it's also very godless here. It is what it is.

Thanks for the link, I'll take a look at the "The Rapture of the Church (039)" study PDF.  I used to be pre-trib, but am more convinced now that there are problems with the logic and am leaning post-trib.  There are problems with that view too, really for any end-times view (pre, post, ect).  It seems like we weren't given a complete picture on this issue, but maybe we place more emphasis on this than we should.  We have assurances he will come for the Church and that He will never leave or forsake us, and in the meantime we should obey Him and build the Church.  I'm good with that.

I'm looking at the super-unification of Europe as well -- my current thinking is the euro currency crisis will bring them together, and then the global financial crisis will usher in the anti-Christ as the purported savior and peacemaker.  Another theory is UFO's will play a huge part in the deception (threat to humankind) and rise to power of the Beast.

Its good to know you're on here too, brother.  There are more of us on here, I try to reach out to each one when they comment.

stiler's picture

There's one more sign I didn't mention that might be seen by the church and that is the Ezekiel 39 invasion of Israel on foot by Russia and her allies. So I'm looking for the breakup of the Eurozone and Russia allying w/ Gomer (Germania to the Rabbis of old). This will bring the demolishing of the eastern part of the balance of power. (it says fire falls on Magog and the isles) laying the road for the OWG.

Yeah, I like ZeroHedge, there are some good thinkers here and some very sharp people, smarter than me. I don't get a lot of the jokes. Maybe there's not much to get.

I like gold and silver, but our faith is more precious than gold that perishes.