Snowden Leaking Treasuries, Too? ~ The Risk Averse Alert

Thursday, August 01, 2013

Snowden Leaking Treasuries, Too?

Maybe the NSA will have a better time than we will finding anything technically constructive about today's [not surprising] rally. Of course, this is assuming its resources are not entirely tied up investigating which terrorist group from the London-New York Axis of Fraud is giving Confetti fits. Longer-dated Treasuries certainly are not being pressured because capital is aggressively migrating into dollar denominated risk lower in the capital structure. Today's conspicuously muted NYSE advance-decline differential instead suggests that, behind the scenes knives are being sharpened, guns cleaned and bombs assembled, readying for the biggest heist Team Fraud has ever organized.

At this point Confetti can only hope risk dripped to the most incompetent bailout faithful has been spread enough to help sooner bring into view the bottom of the canyon the trans-Atlantic inevitably will be thrown into once swindle comes to town. As sure as the sun rises, an extortion of some sort is a foregone conclusion, and quite likely will be of unprecedented proportion to boot—the likes entirely being facilitated by the Confetti Fed to be sure. There are limits to debasing a currency and suckering support from lenders of last resort flooding the globe with liabilities venturing to sustain a Ponzi scheme destroying real wealth to a degree never before seen in modern history. Of course, the thieves will entirely ignore this latter consideration when reciting demands that must be met in exchange for confidence crumbs puffed up with fraudulent fantasies supporting organized crime's wisdom on the subject of debt "sustainability."

The arrangement in which the Fed is perilously situated has cultivated a parabolic increase in indebtedness across the spectrum. The record since August 15, 1971 is conclusive. On this date began the modern era of wildcat finance feeding an asset-stripping Ponzi scheme. The Fed's ongoing effort since 2008's collapse of an unbridled shadow banking system is all about sustaining Ponzi dynamics formerly facilitated through an infinite multiplier, the likes of which was endlessly rationalized by Confetti's predecessor, King Ponzi (Greenspan). As ever in the modern era, old claims on wealth are propped up only by an increasing flood of new. These days, capital Confetti frees directly supporting U.S. Treasuries, as well as mortgage-backed securities of the hopelessly insolvent likes of Morgan Stanley and Goldman Sachs, provides the means of pretending there's real demand for an increasing supply of what we otherwise here rightly call garbage, the likes whose stink must increase with its price, as its backstop now stripped of well-padded clothing once exuding the impression there was much muscle beneath it rather is exposed a decrepit skeleton whose taxing power is but one swindle from rendering the U.S. Treasury insolvent. We may have more sensitive noses than most folks, but it is only a matter of time before the distinct odor of a maggot infested mountain of trash becomes overwhelming. Trouble is it will be too late for the credulous once the smell of rotting garbage is widely recognized. The Fed at least has succeeded at making 2008 seem a distant memory not soon likely to be repeated. However nothing could be further from the truth. The technical state of claims at the bottom of the capital structure conclusively confirms this, and no less now than four years ago when Confetti supercharged the hyper in inflation, accelerating the physical economy's shutdown claiming "excess capacity" would put a lid on price pressure—a state of affairs now even more so pressing on the trans-Atlantic's core, having reeked maximum havoc on its periphery over the interim. Truth is when you're out of work, or more relevantly, working for less than you are really worth, inflationary pressures are bound to increase even if the price on everything you consume remains stable.

A banking system at whose apex is an incompetent academic, well-schooled at the Ivy League in the art of subversion, presents itself incapable of investing in a future founded upon an expanding productive capacity generating increasing stores of tangible wealth elevating per capita purchasing power, and instead is being directed only to more increasingly cannibalize what remains of an economy whose former, abundant surpluses have long since been destroyed (accelerating a trend moved deeply into the realm of insanity by King Ponzi). This, the true face of hyperinflation—a carbon copy of circumstance leading to Wiemar Germany's blowout in 1923—is the crux of the matter that need be reversed as Confetti is put to pasture over coming months. If the push for Janet Yellen as new Fed chair succeeds, the only thing to come of it likely will be conclusive proof you can grow tits on a bull.

At this point, though, far less important is the person leading the Fed. Rather the intent of vested interests behind the Fed's leadership is the most telling matter whose consequence will determine whether capitalism is resuscitated from the killer clutches of today's enslaving imperialism, or dies once and for all alongside the United States itself. More Confetti simply will not do here. This Yellen represents, as Team Fraud's adoration confers.

Investment in the wealth creating capacity of the future is the only sane rallying call for those whose real wealth—purchasing power—has been positively trampled for decades now, and whose very lives literally hang in the balance in the midst of imminent transition in a hopelessly insolvent banking system's leadership. If the Fed is not virtually seized by Congress and compelled to finance the build out of a physical economy worthy the 21st century, then we can kiss the world as we have known it goodbye, as it is undeniable Ponzi finance has reached its most extreme limit tying up lenders of last resort to an extent rendering these helpless in servile obeisance to the greatest scam the world has ever endured, leaving it now standing at the precipice of a woefully short-sighted, self-imposed doom.

In other words, positively delusional is anyone thinking expanding PMIs somehow lessens the credibility of a dire outlook mindful of the general history of Venetian intrigues fostering broad societal engagement in the extremest forms of irrationality. A "recovery" of what was lost in an economy that, some decades ago was far less indebted and far more productive, while lenders of last resort were far less entangled, is hardly worth noting. Truth is were there anything of real value behind this so-called manufacturing recovery, Team Fraud would be dissing it, venturing to stimulate an exodus of shares they then would gladly snap up. Today's excited reporting rather reveals it's Team Fraud's garbage seeking a new home among a crowd who otherwise is relentlessly being conditioned into believing shares are "cheap." All of today's happy talk rather confirms our view that, share prices have never been more dear.

Given a well-established trend crushing abundance and promoting scarcity (think, for example, an energy refining business whose collapse continues), there is no way a modest recovery in manufacturing activity somehow relegates a still parabolically increasing indebtedness more so self-sustainable. Delusion alone is being fed for the better sake of a brief moment yet closer to seeing its truth exposed for what it really is: consuming the blind with meaningless claptrap in order to satisfy their fancy for being fleeced. Absent expansion in the availability of material resources needed to sustain a modern economy (this to the point of creating profound abundance), the debt trap built in the wake of the demise of the Bretton Woods system of fixed exchange rates is foremost destined to implode. All financial claims throughout the trans-Atlantic and, indeed, the global capital structure are only the more at grave risk of severe markdown, if not outright default. It's either that, or a date with destiny in purchasing power gone Wiemar. It goes without saying the "no one saw it coming" crowd running Wall Street possesses a profound interest in maintaining ignorance toward this inevitable outcome, so long as their ultimate expendability can be deferred as price for feigning blindness. Trouble is this accommodation cannot be made permanent. Of course, this truth does not deflect hope's tendency to wax eternal no matter how fixed all eyes are on the exit.

Most frighteningly at risk presently, though—most relevant to the average Jane or Joe—is the functional integrity of the system of sovereign nation states whose authorities built up over the course of the past several centuries continue to be lured into today's newfangled Venetian trap elevating irrationality to unseen heights at whose impending peak is promise to make Europe's fascist experiment of the 20th century look like a church picnic. The longer the United States, itself, accommodates this course of affairs through the mutual elevation of incompetents into leadership positions and forbearance prosecuting treason such likes and their many supporters, yesterday and today, up and down the societal spectrum are empowered to perpetuate, the surer will be violence proceeding from inevitable chaos today's climate, momentarily facilitating collective blindness, undoubtedly assures. We would be delusional, ourselves, to think this end is something other than intended. A Venetian-modeled oligarchy rather rightly is seen venturing the effective destruction of a United States institutionalizing the elevation of all mankind as its foremost collective priority. Indeed, one must be blind not to recognize this deadly attack in an age when the "viability"of corrupt finance assumes utmost precedence over the human condition, no matter how degraded the latter must become as a consequence. Isn't that right, Detroit? What say you, Greece? Cyprus? Ireland? Portugal? Spain? ...

Word on the Street
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