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Chris Martenson: "Are We Heading For Another 2008?"

Tyler Durden's picture


From Chris

Are We Heading For Another 2008?

We all know that central banks and governments have been actively intervening in markets since the 2007 subprime mortgage meltdown destabilized the leveraged-debt-dependent global economy. We also know that unprecedented intervention is now the de facto institutionalized policy of central banks and governments. In some cases, the financial authorities have explicitly stated their intention to “stabilize markets” (translation: reinflate credit-driven speculative bubbles) by whatever means are necessary, while in others the interventions are performed by proxies so the policy remains implicit. 

All through the waning months of 2007 and the first two quarters of 2008, the market gyrated as the Federal Reserve and other central banks issued reassurances that the subprime mortgage meltdown was “contained” and posed no threat to the global economy. The equity market turned to its standard-issue reassurance: “Don’t fight the Fed,” a maxim that elevated the Federal Reserve’s power to goose markets to godlike status.

But alas, the global financial meltdown of late 2008 showed that hubris should not be confused with godlike power. Despite the “impossibility” of the market disobeying the Fed’s commands (“Away with thee, oh tides, for we are the Federal Reserve!”) and the “sure-fire” cycle of stocks always rising in an election year, global markets imploded as the usual bag of central bank and Sovereign State tricks failed in spectacular fashion.

Keep Doing More of What Has Failed Spectacularly

Central banks and states responded by doing more of what had already failed spectacularly. In the ensuing years 2009-2012, they increased money supply and liquidity and lowered interest rates to zero or near-zero. And sovereign states borrowed vast sums to squander on “stimulus spending.” This “doing more of what has failed spectacularly” earned the apt moniker of “extend and pretend.” Nothing was actually fixed, but we were encouraged to believe it had been fixed with a flurry of absurdly complex “reforms” that only increased the power of the central states and banks without actually addressing the underlying causes of the meltdown: extremes of leveraged debt, extreme concentrations of financial wealth that then bought political power, shadow banking and opaque markets for hundreds of trillions of dollars in notional derivatives, systemic fraud and embezzlement, phony valuations assigned to assets and liabilities, and various schemes to misprice risk, among others.

If we had to distill the entire global crisis into the simplest possible statement, we might say that the collateral that supported this great inverted pyramid of leveraged debt vanished, and as a result the entire pyramid crumbled.

Since the global housing bubble was at the heart of the crisis, let’s use housing to explain this simple summarization. If a house that was owned free and clear (no mortgage debt) rose in value from $200,000 to $500,000 during the bubble, the collateral of that asset was valued at $500,000 at the peak. If the house has fallen to $250,000 in the post-bubble decline, the collateral is now $250,000.

Since there was no debt leveraged off of that collateral, the owner experienced no leveraged consequence of that decline. His assets fell, and he felt the “reverse wealth effect,” so he feels poorer even though his asset is nominally worth more than it was prior to the bubble. (Adjusted for inflation, that nominal gain might well vanish into a decline in purchasing power, but that’s another story.)

Compare that to the home purchased for $500,000 with a highly leveraged subprime mortgage in which 3% of actual cash collateral ($15,000) was leveraged into a mortgage of $500,000. (For simplicity’s sake I am leaving out the transaction costs.)

The collateral was leveraged 33-to-1. This is delightfully advantageous if the house continues rising in value to $600,000, as that increase generates a six-fold return on the cash invested ($15,000 in, $90,000 out). But once the house prices slipped 10% to $450,000, then not only did the 3% cash collateral vanish, the collateral supporting the mortgage also declined. The mortgage was no longer “worth” $500,000.

Since Wall Street securitized the mortgage into mortgage-backed securities (MBS) and sold these instruments to investors, then the value of those MBS also fell as the collateral was impaired. And since various derivatives were sold against the collateral of the MBS, then the value of those derivatives was also suspect.

If $1 of collateral is supporting an inverted pyramid of $33 of leveraged debt, which is then the collateral supporting an even larger pyramid of derivatives, then when that $1 of collateral vanishes, the entire edifice has lost its base.

And that's at the heart of current central bank policy: “Extend and pretend” is all about keeping the market value of various assets high enough that there appears to be some collateral present. 

In our example, the mortgage is still valued on the books at $450,000, but the actual collateral — the house — is only worth $250,000. The idea being pursued by central banks around the world is that if they pump enough free money and liquidity into the system, and buy up impaired debt (i.e., debt in which the collateral has vanished), then the illusion that there is still some actual collateral holding up the market can be maintained. 

Subprime Mortgages Have Given Way to Subprime Sovereign Debt

The implosion of overleveraged subprime mortgages triggered the 2008 global meltdown because the market awoke to the fact that the collateral supporting all sorts of debt-based “assets” had vanished into thin air. Four years later, we have another similar moment of recognition: The collateral supporting mountains of sovereign debt in Europe has vanished. The value of the debt — in this case, sovereign bonds — is now suspect.

The European Central Bank (ECB) has played the same hand as the Federal Reserve: Do more of what has failed spectacularly. Expand the money supply, pump in more liquidity and buy up the impaired debt all in the hope that the market will believe that there is still some collateral holding up the leveraged-debt pyramid.

The ultimate collateral supporting the stock market is the book value of the assets owned by the company, but the notional collateral is corporate profits: equities are claims on the future free cash flow generated by the corporation.

There are all sorts of inputs into this calculation, and markets are supposed to reflect these various inputs: currency valuations, sales, profit margins, costs of labor and raw materials, inflation and so on. Now that markets are manipulated to maintain the illusion that there is enough collateral out there somewhere to support the inverted pyramid of leveraged debt, it’s difficult to know what’s real and what’s illusion.

One of the few ways we have to discern the difference is to compare various markets and look for divergences. If a spectrum of markets and indicators is pointing one way and another market is pointing the other way, we then have a basis for asking which one is reflecting illusion and which one is reflecting reality.

In 2008, the central banks and governments lost control of the illusion that there was sufficient collateral to support a stupendous mountain of leveraged debt. By doing more of what failed spectacularly then, they have laboriously reconstructed the illusion that they control the markets (“Away, tides, for we are the ECB!”) and thus the valuation of collateral.

Once again we are sternly warned not to “fight the Fed,” as if the Fed had the financial equivalent of the Death Star (“You don’t know the power of the Dark Side!”). Once again, we are in an election year where the four-year cycle is supposed to “guarantee” an up year in stocks.

Or maybe 2012 is shaping up to reprise 2008, and the market will wake up to the fact that intervention doesn’t create collateral, it only creates the temporary illusion of collateral. 

In Part II: Why A Near-Term Market Rollover is Probable, we will look at key technical indicators that suggest the Fed’s Death Star may not be the ultimate financial weapon in the Universe after all. There is a growing series of global data that suggest the run-up in the equity markets has reached its peak, and that the economic sickness the central banks had hoped to "cure" with all of their money printing is metastasing. 



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Wed, 04/11/2012 - 15:35 | 2335607 Sudden Debt
Sudden Debt's picture

Hey dude, i'm out of money but can you spare a brother a quick hopium fix?
I'll pay you back tomorrow!

Wed, 04/11/2012 - 15:49 | 2335669 BKbroiler
BKbroiler's picture

Are we heading for another 2008?

I hope so, grocieries and gold were cheaper

Wed, 04/11/2012 - 15:58 | 2335719 Pladizow
Pladizow's picture

One worrd summary: FRAUD!

Wed, 04/11/2012 - 16:39 | 2335860 The Big Ching-aso
The Big Ching-aso's picture



"Are We Heading For Another 2008?"

I hope so.   It wasn't as bad as 1929.


Wed, 04/11/2012 - 19:00 | 2336250 nope-1004
nope-1004's picture

Are we heading for another 2008?

I hope so, grocieries and gold were cheaper

The increase in the price of food staples and the recent fears of inflation are largely overstated.  Rising food prices in developing nations can be attributed to an increasing population and the people within those nations seeking more sophisticated diets.


- Benocide, spring 2011



Wed, 04/11/2012 - 20:46 | 2336531 dark pools of soros
dark pools of soros's picture

biggie size me ben

Wed, 04/11/2012 - 20:22 | 2336490 jplotinus
jplotinus's picture

The word FRAUD does not appear often enough in this thread, though pladizow's first mention of fraud is here noted with appreciation.

Wed, 04/11/2012 - 17:14 | 2335970 Sudden Debt
Sudden Debt's picture
This is what they had to say in 1946 about price increases

Wed, 04/11/2012 - 17:27 | 2336007 NewThor
NewThor's picture

We are heading for a '2012'.

Bank on it.

Wed, 04/11/2012 - 15:49 | 2335675 aerojet
aerojet's picture

Can I write you a check?

Wed, 04/11/2012 - 16:13 | 2335766 battle axe
battle axe's picture

Those crazy Mayan's were they on to something or stoned out of their heads?

Wed, 04/11/2012 - 16:37 | 2335851 Janice
Janice's picture

I prefer stoned, just like the great rockers of the 60's, 70's and parts of the 80's. Have you heard the stuff they call music today?

Wed, 04/11/2012 - 17:28 | 2336011 NewThor
NewThor's picture

The Jonas Brothers are probably the most anti-establishment rock and roll band ever!


Wed, 04/11/2012 - 18:30 | 2336179 Born-Again Bankster
Born-Again Bankster's picture

Today's music is very telling, if you know how to interpret it:


1992:  Barenaked Ladies - "If I had a million dollars"


2010: Bruno Mars - "I wanna be a billionaire"


Inflation even in the lyrics...bitchez.



Wed, 04/11/2012 - 16:25 | 2335816 slaughterer
slaughterer's picture

Who wants one of my "It's only 2012, and it's 2008 all over again!!!!" T-shirts?  They come in red, white and blue.   They cost only 1,680 dollars a piece.  Bullion or semi-automatic ammunition accepted.  

Wed, 04/11/2012 - 15:35 | 2335608 Buckaroo Banzai
Buckaroo Banzai's picture

We should be so lucky to get another 2008. We're heading for an Argentina in 2001.

Wed, 04/11/2012 - 16:45 | 2335871 Max Fischer
Max Fischer's picture



The constant comparison of the United States to Argentina is just flat-out bogus - or, in other words, another perfectly fitting example of barnyard libertardians who don't understand the mechanics of debt, currency and crisis.

The difference between the US and Argentina is that 90% of Argentina's stock of debt was issued in a foreign jurisdiction and denominated in a foreign currency.  This makes them entirely dependent on the FX markets and the whims of FX speculators to service that debt.  Same was true for Weimar and Zimbabwe.

Not true for the United States.  Our debt is denominated in US dollars, and we've got 100% rights on the printing press needed to service that debt. Moreover, if any country foolishly decided to take hostile action against our bonds by dumping them en masse in the market, we've got the world's most sophisticated military to persuade them otherwise.  Luckily, Ron Paul is NOT president, so we've also got a Federal Reserve which is the economic equivalent of being fully armed against economic attacks.  

In the future, please don't make the US/Argentina comparisons.  I've said this before, so it's your last warning.

Don't be dumb. 

Max Fischer, Civis Mundi   

Wed, 04/11/2012 - 16:45 | 2335889 Saro
Saro's picture

It's like MDB and Robotrader had a retarded child together and got him his own account here.

Wed, 04/11/2012 - 17:11 | 2335959 Optimusprime
Optimusprime's picture

After sending him to neo-con CIA school.

Wed, 04/11/2012 - 16:49 | 2335902 Robslob
Robslob's picture

1) Countries are just beginning to dump our bonds

2) Countries are just beginning to arrange for "other" currency agreements between each other


Apparently you hate feedom because if RP was President, while it would be painful up front, we could begin rebuilding instead of tearing down...which is what bankers need to do to break even (Hint: make everyone elses real assets worth shit too)

Wonder what will happen to Military pay when none is left to buy our bonds...which pays for the military.

Wed, 04/11/2012 - 16:52 | 2335910 LawsofPhysics
LawsofPhysics's picture

You elude to a point that I have been asking for quite some time.  Why do people so readily discount a military takeover in the U.S.?  Perhaps they think the veterans are all overrun with joy at the high paying jobs they have landed upon returning or leaving the service of their country? < sarc off >.

Wed, 04/11/2012 - 17:26 | 2336002 Koffieshop
Koffieshop's picture

You might be onto something here.

I am kinda hoping for a military takeover in one of the PIIGS (when the rioting really takes off) so that the Euro can die sooner then later.

The population needs to be a bit more angry then they are now though.

Wed, 04/11/2012 - 19:21 | 2336317 HurricaneSeason
HurricaneSeason's picture

I'd like to see a takeover. Like the Chinese guy sitting in front of the tank in the square. They should have just let him take over for a week. I don't see any possibility of anyone taking over Detroit or Los Angeles. Even though we are protecting Detroit and Los Angeles from a Russian takeover, we really don't need to do that.

Wed, 04/11/2012 - 17:07 | 2335946 Max Fischer
Max Fischer's picture



Countries are NOT beginning to dump our bonds.  Obviously, you're referring to China who has trimmed their stock of US treasuries over the past 6 months, but unfortunately you haven't been told that Japan is INCREASING their holdings by nearly the same amount that China is trimming. Furthermore, you haven't been exposed to articles which tell you that while China is buying less treasuries, they're buying MORE US mortgage backed securities.  While Operation Twist is being implemented by the Fed, and everyone anticipating some sort of clandestine QE effort to jump start housing, why not exchange some long dated bonds for some MBS?  Makes sense.    

Also, there is nothing remarkable about our enemies wanting to end the petrodollar.  Ahmadinejad? Castro? Gaddafi? Saddam?


Max Fischer, Civis Mundi

Wed, 04/11/2012 - 17:41 | 2336047 Koffieshop
Koffieshop's picture

There is no chance those MBS are backed with the ownership of the house and land it is build on, right?

Wed, 04/11/2012 - 19:50 | 2336414 Seer
Seer's picture


Japan is pretty much fucked.  I wonder how much this comes in to play:

Yukiya Amano even looks like Dick Cheney.  Being that Japan is handcuffed energy-wise, I can see this as being a tit-for-tat: help the US get a hold of Iranian oil in exchange for Japan's US treasury purchases.

Anyways... how long do you think that Japan can hold up US treasuries?  China sure ain't going to be ramping up (they've got to SPEND, SPEND, SPEND internally to keep their masses from coming unglued [lots of luck there!]).  The world's economy is starting to reverse and the US continues to need MORE funding (and so does everyone else).

People often fail to understand that everything really does work on only the slimmest of margins, and that a shifting of a mere 1% to 2% is all it takes...


Wed, 04/11/2012 - 16:50 | 2335903 LawsofPhysics
LawsofPhysics's picture

All fine and good until the rest of the world won't accept your paper.  What a loser.

Wed, 04/11/2012 - 17:13 | 2335966 Max Fischer
Max Fischer's picture



Did you know the Federal Reserve devalued the dollar by 40% in 1934 while we were on the gold standard?

My fiat is - potentially - as equally worthless as your gold-standard. 

Max Fischer, Civis Mundi

Wed, 04/11/2012 - 17:49 | 2336070 brewing
brewing's picture

we already have an MBD...

Wed, 04/11/2012 - 19:51 | 2336418 Seer
Seer's picture

"My fiat is - potentially - as equally worthless as your gold-standard. "

And potentially NOT.  History gives us some idea on the probabilities.  Those who are prepared for the future will fare better than those who do not.

Wed, 04/11/2012 - 19:52 | 2336419 luna_man
luna_man's picture



Hey, You guy's lighten up on "Max"...He's still living that "american dream", until it smacks him in the nose...Then, you can say: I told you so!

IN DENIAL?...That's OK by us...RIGHT?

Wed, 04/11/2012 - 21:37 | 2336619 ebworthen
ebworthen's picture

Max, Roosevelt confiscated gold and cemented the formation of the nanny socialist state.

And, isn't this an argument to get rid of the FED?

You know, markets and all that?

The FED is a parasite.

Wed, 04/11/2012 - 16:53 | 2335913 MunX
MunX's picture

How long have you worked for the AAE?

Wed, 04/11/2012 - 17:12 | 2335960 gnomon
gnomon's picture

"Argentina 2001"?  We have never been "here" before.  And to believe that we know all of the likely outcomes from this unprecedented manipulation and pumping, and that we have all of our bases covered is the equivalent of believing that one's feces does not reek.

Strange (and terrible) things happen when you are doing the ridiculous and unsustainable, (and your luck runs out).

Wed, 04/11/2012 - 17:13 | 2335968 Raymond Reason
Raymond Reason's picture

Our currency also has the dubious honor or being the world's reserve currency, and is therefore vulnerable to greater devaluation than the Argentinian Peso.  Even if we could hold a gun to the head of every country with US bonds (and you're dreaming there), the bond market is only part of what holds up the USD. 

Wed, 04/11/2012 - 17:28 | 2336009 The Alarmist
The Alarmist's picture

Difference between US and Argentina is that the US version of Evita is decaying before our very eyes ... did you see her with the Saudi king? She looked like Jabba the Hut.

Wed, 04/11/2012 - 17:44 | 2336060 KickIce
KickIce's picture

And who in this "sophistcated" military is going to fight when their money is worthless?

Wed, 04/11/2012 - 20:50 | 2336540 Race Car Driver
Race Car Driver's picture

The same sadistic mercenaries who have done it thruout history. They don't do it for money... they do it for the rape and pilliage.

Look around at our current culture - do you really think our military isn't chock-to-the-brim with this type of sicko (see also: Abu Ghraib)?

Wed, 04/11/2012 - 20:50 | 2336538 dark pools of soros
dark pools of soros's picture

+1 for going full Krugman

Wed, 04/11/2012 - 21:32 | 2336607 ebworthen
ebworthen's picture

Max, Max, Max.

Never say never.

Repeat after me:  "The sun will never set on the British Empire", "King Louis XVII rules by the will of God", "All Hail Caesar", etc., etc.

You should get off PBS and outside of the Beltway to see reality beyond that bubble you're living in.

Wed, 04/11/2012 - 18:24 | 2336163 Born-Again Bankster
Born-Again Bankster's picture

Long Kenneth Dart holdings.

Wed, 04/11/2012 - 15:36 | 2335609 Jason T
Jason T's picture

Martinson is mint.. but it's like the poor guys been waiting for the great pumpkin.. the great crash.


To a degree, we all are.

Wed, 04/11/2012 - 15:48 | 2335671 Spastica Rex
Spastica Rex's picture

Call me Linus.

Wed, 04/11/2012 - 17:36 | 2336025 redguard
redguard's picture


Wed, 04/11/2012 - 15:36 | 2335610 vast-dom
vast-dom's picture

"...intervention doesn’t create collateral, it only creates the temporary illusion of collateral." which in turn created the temporary illusion of a recovery.

Wed, 04/11/2012 - 15:36 | 2335611 insanelysane
insanelysane's picture

Did we ever leave 2008?

Wed, 04/11/2012 - 16:30 | 2335831 Clowns to the l...
Clowns to the left_ jokers to the right's picture

I don't think we really left 2001. The housing bubble only gave us a brief faux recovery.

Wed, 04/11/2012 - 15:39 | 2335624 SHEEPFUKKER

Two thousand and Late. 

Wed, 04/11/2012 - 15:42 | 2335644 Taint Boil
Taint Boil's picture



Your screen name is worst than mine.

Wed, 04/11/2012 - 15:50 | 2335678 IndicaTive
IndicaTive's picture

No it isn't.

Wed, 04/11/2012 - 16:23 | 2335791 Sweet Chicken
Sweet Chicken's picture

You into sheep fucking?!?


Apparently you have five friends that would like to join you in your next escapade.




Make that six. :/

Wed, 04/11/2012 - 16:47 | 2335839 Clay Hill
Clay Hill's picture

Ever had a boil between Urscrotum and Uranus?

Wed, 04/11/2012 - 16:48 | 2335862 IndicaTive
IndicaTive's picture

Sweet Chicken: Perhaps you should brush up on your gay slang next time you choose a name for yourself...or maybe you did.

Wed, 04/11/2012 - 17:20 | 2335984 Sweet Chicken
Sweet Chicken's picture


I don't get it!!!!

Wed, 04/11/2012 - 15:47 | 2335659 Mad Max
Mad Max's picture

He's Shaun the sheep. He's Shaun the sheep. He even mucks about with those who cannot bleat.

Wed, 04/11/2012 - 15:39 | 2335629 Buckaroo Banzai
Buckaroo Banzai's picture

On a completely different note, several times a day I am being exhorted to be careful of the bitch in Apt 23. Also to sign up for sugar daddy dating, presumably to search for young women who want to be whores without exactly calling themselves whores. Are these two things related?

Wed, 04/11/2012 - 15:43 | 2335645 battle axe
battle axe's picture


Wed, 04/11/2012 - 16:06 | 2335677 dogbreath
dogbreath's picture

they're not whores,  they just presume that they are worth it and deserve it.

Wed, 04/11/2012 - 16:37 | 2335854 Silver Dreamer
Silver Dreamer's picture

Technically, they are all whores.  What woman do you know that has sex for nothing?  They are always gunning for something.  It may just not be cash.

Wed, 04/11/2012 - 17:19 | 2335974 beachdude
beachdude's picture

It never used to be that way.
Money wasn't an issue... Just lots of fun and drinking and drugs and sex.

Wed, 04/11/2012 - 17:15 | 2335975 nodhannum
nodhannum's picture

It used to be called the "PIK" Program...Payment In Kind Program.  Previously it was related to agricultural products now it is related to expensive dinner, vacations, jewelry, etc.  I have to disagree that all the honeys are whores.  I always vetted american women out first, telling them that since I respected them as "Ms Persons" I couldn't treat them as dependents because I respected them too much.  Got rid of the gold diggers quickly.  You would be amazed at the ones that didn't did, who were profession and paid their own way.  Sad to say that most of them were central to northern europeans with some asians throw into the mix.  Americans not so much.  

Wed, 04/11/2012 - 23:26 | 2336784 Gift Whores
Gift Whores's picture

Don't fool yourself.  It's all about the whores.

Wed, 04/11/2012 - 15:53 | 2335692 HarryM
HarryM's picture

At least they're honest

Wed, 04/11/2012 - 16:27 | 2335820 booboo
booboo's picture

At least a call girl has some collaterhole to back up that price

Wed, 04/11/2012 - 15:54 | 2335697 Gully Foyle
Gully Foyle's picture

Buckaroo Banzai

Look for the ones with Daddy issues, lower self esteem and cost less.

Isn't that Apt 23 thing an upcoming tv show?

Probably should avoid that like the plague.

Wed, 04/11/2012 - 16:03 | 2335744 SheepDog-One
SheepDog-One's picture

I do like seeing the redhead busty kind of thick Snorgtee's model.

Wed, 04/11/2012 - 16:23 | 2335803 12ToothAssassin
12ToothAssassin's picture

The one with the unzipped jeans? I hadnt noticed.

Wed, 04/11/2012 - 16:16 | 2335777 Marginal Call
Marginal Call's picture

Ads for HP printer ink have started showing up.  Like people talk about printing here all the time.

Wed, 04/11/2012 - 16:29 | 2335830 blunderdog
blunderdog's picture

   Are these two things related?

They both indicate you're not computer/internet-savvy.

Wed, 04/11/2012 - 16:31 | 2335835 catacl1sm
catacl1sm's picture

I'm thinking that the sugar daddy whoring created the bitch in apt 23. Correlation and causation. Nice, neat, ribbon is free.


On another note, now that we've had "Shit my father says" and "The bitch in apt 23", can we just skip ahead 5 or 10 years and get shows on regular cable like "Things she'll let me stick in her ass for $100" and "How much bukake can you take" now? (these ideas are hereby copyrighted).

Wed, 04/11/2012 - 16:54 | 2335914 RafterManFMJ
RafterManFMJ's picture

You get a plus one for using 'exhorted.' When dating these mercenary women try this line:

“So, what’s your type?”

“A busty blonde who runs a liquor store… but in a pinch, I’ll take any two out of three.”


Wed, 04/11/2012 - 17:31 | 2336015 The Alarmist
The Alarmist's picture

Reminds me the old sales line, "Quick, cheap, or good ... you get to pick two."

Wed, 04/11/2012 - 17:47 | 2336027 tamboo
tamboo's picture

beats lookin at the hideous mr. overachiever, romney , or the transexual ann coulter.

Wed, 04/11/2012 - 18:07 | 2336086 Jendrzejczyk
Jendrzejczyk's picture

The guy monitoring me, got me this cookie:

Anyone else noticing their ZH articles marked as read when they haven't been logged in all day?

Edit: To my shadow.... Yes, I've noticed and you are still fucking up. Do better, don't lose your job. It's tough out here in the real world.

Wed, 04/11/2012 - 21:40 | 2336626 ebworthen
ebworthen's picture

Whores, but "liberated" whores who can't see that vapid skankiness does not stand the test of time.

Wed, 04/11/2012 - 15:41 | 2335633 battle axe
battle axe's picture

2008 screw that, bring on the Dark Ages and the Black Death. Lets stop messing around. 

Wed, 04/11/2012 - 15:56 | 2335704 Gully Foyle
Gully Foyle's picture

battle axe

Dark ages, what kind of pussy are you?

Neolithic is where the real men hang.

Wed, 04/11/2012 - 18:00 | 2336020 The Alarmist
The Alarmist's picture

Nah, the Black Plague resulted in the labor shortage that led to the collapse of feudalism and began 800 years of increasing personal liberty and increasing prosperity. We see (and hear from the US President) what a failure that experiment was, so let's just stick to the Dark Ages and be happy that we're being kinder to Mother Gaia.

Wed, 04/11/2012 - 15:42 | 2335638 babylon15
babylon15's picture

The crash may not be sudden at all, like 2008, but more prolonged like Japan's 20-year-and-counting recession.

Wed, 04/11/2012 - 16:23 | 2335800 LawsofPhysics
LawsofPhysics's picture

We have a winner!  Japan was the ultimate experiment in cognitive dissonace, until now.

Wed, 04/11/2012 - 16:41 | 2335866 Silver Dreamer
Silver Dreamer's picture

It's a dangerous assumption to think our scenario will play out the same as it has for Japan, correct?

Wed, 04/11/2012 - 16:47 | 2335894 LawsofPhysics
LawsofPhysics's picture

Sure, but only if you think default is actually an option.  Otherwise, the Debt:GDP ratio and growth promises make it pretty clear.  The implications of exponential equations are indeed poorly understood by most.  Growth is no longer possible, in the absence of something that will increase the available flux of energy through the system.  Now, where the hell are those fusion reactors I ordered?

Wed, 04/11/2012 - 17:21 | 2335990 Optimusprime
Optimusprime's picture

Very dangerous.  Japan is a racially homogeneous society.

Wed, 04/11/2012 - 16:54 | 2335915 centerline
centerline's picture

Drawn out is the goal.  But, we are not Japan and the risk this time is global.  Seems to me we are going to drag this out awhile... then hit the wall.  I think we will be lucky to have 24 hour advance notice of the impending lock-up thanks to ZH.  Just enough time to unload fiat at the nearest grocery store, fuel station, etc. as fast as possible.

Wed, 04/11/2012 - 17:54 | 2336089 lakecity55
lakecity55's picture

Yes, I have a machine that turns fiat into PMs. It is called the local "coin shop," and they take cash.

Keep Stackin'

Wed, 04/11/2012 - 17:36 | 2336026 The Alarmist
The Alarmist's picture

Little chance of that ... Japan's society is far more homogenous and the people are less likely to brutally prey on one another.

Wed, 04/11/2012 - 17:46 | 2336061 tamboo
tamboo's picture

so's argentina but  hungry is hungry.


Despair in Once-Proud Argentina - OMINOUS PARALLELS
Wed, 04/11/2012 - 15:43 | 2335646 Dr. Engali
Dr. Engali's picture

The system died in 2008. We are just on life support until TPTB call the time of death.

Wed, 04/11/2012 - 15:43 | 2335649 GeneMarchbanks
GeneMarchbanks's picture

Martenson's need for a narrative is almost as obvious as his constant hind-sight, rear-view checking to somehow 'predict' a downturn.

In reality he is one of the most dogma prone posters around.

Wed, 04/11/2012 - 15:45 | 2335653 Obadiah
Obadiah's picture

Wow, is there anything positive we can say or do?  Don't we all agree this shit can't last forever,  they will play this shit out for another decade.  MadMax World is still 10years out dont cha think?

Wed, 04/11/2012 - 15:57 | 2335715 Gully Foyle
Gully Foyle's picture


Not another decade.

Endgame for the Us runs through Romney's two terms. With moving into OWG during his second.

Can you say global reset and digital currency.

Wed, 04/11/2012 - 16:01 | 2335735 SheepDog-One
SheepDog-One's picture

For all anyone knows 2012 is the year they pull the rug out. What do they have left to do here after theyve monetized all the debt, $30 trillion over the last few years...just play footsie? No point in it.

Wed, 04/11/2012 - 16:43 | 2335879 Silver Dreamer
Silver Dreamer's picture

We've seen an awful lot of foreplay.  Everyone knows what comes next too.

Wed, 04/11/2012 - 17:16 | 2335977 Clowns on Acid
Clowns on Acid's picture

Gully - it maybe a digital currency, but it will be based upon PMs. What else could they base it on..? Confidence in the issuing Central bank ? 

Wed, 04/11/2012 - 15:48 | 2335666 dogbreath
dogbreath's picture

fast forward 2015.........." are we heading for another 2012"

Wed, 04/11/2012 - 17:34 | 2336019 BlackholeDivestment
BlackholeDivestment's picture

...asking a question like that in 2015's black hole will be a joke.

Wed, 04/11/2012 - 17:37 | 2336032 The Alarmist
The Alarmist's picture

fast forward to 2029: "2012 ... gee, those were the good old days!"

Wed, 04/11/2012 - 15:49 | 2335668 PaperBear
PaperBear's picture

Please can someone count how many times the central planners have been wrong ?

Wed, 04/11/2012 - 16:11 | 2335759 Joeman34
Joeman34's picture

Every time

Wed, 04/11/2012 - 16:53 | 2335912 Joeman34
Joeman34's picture

Bernanke, why you junk'n me fool?

Wed, 04/11/2012 - 15:55 | 2335703 Yen Cross
Yen Cross's picture

 Looks like N.Y. is in sell the rally mode. The post Europe (close), meltup idea looks like a Cheetah at the end of a 1/4 mile sprint.

 The Beige Book wasn't bad. I'm a bear, but these head fakes, ( short covering/ BTFD) crap is geting really old!


Wed, 04/11/2012 - 16:00 | 2335726 SheepDog-One
SheepDog-One's picture

Just a bit of dead cat bounce....after all the DOW is down from 13,400, near 700 points without anyone really noticing.

Wed, 04/11/2012 - 16:12 | 2335762 Yen Cross
Yen Cross's picture

Good point Sheep Dog! It's the es/spx that perplexes me? 1370-75 should be capping this thing. 50sma/ 55ema.

 This i-this & i-that (canibalization) is laughable! Tyler has been spot on with respect to that.  A friend of mine Emailed this to me.

" Liver for i-phone China".  These markets are so skewed!

Wed, 04/11/2012 - 16:26 | 2335819 tekhneek
tekhneek's picture

Here kitty kitty... I'm 8000 and we should hang out sometime.

Wed, 04/11/2012 - 17:40 | 2336035 The Alarmist
The Alarmist's picture

Nah, 700 points is like one sigma for a week nowadays. Nothing to see here.

Wed, 04/11/2012 - 15:57 | 2335716 debtor of last ...
debtor of last resort's picture

I'd like the Phd's come home to roast. Ehhh

Wed, 04/11/2012 - 15:57 | 2335718 Few
Few's picture

some times you just need to kick your brain in neutral and be glad.

I'm so glad I'm so glad I'm glad I'm glad I'm glad ...

Wed, 04/11/2012 - 15:59 | 2335720 buzzsaw99
buzzsaw99's picture

Away, tides,...


I prefer CCR to (Hendrix?). There's a bathroom on the right:

Wed, 04/11/2012 - 16:01 | 2335732 ShankyS
ShankyS's picture

Why question, "Are We Heading For Another 2008?" when we all know what's coming. It is just a matter of time and the appropriate catalyst. We'll all know when that door is opened, and the rush for the gates (and into gold) will be greater than historical. 

Wed, 04/11/2012 - 16:03 | 2335743 Clay Hill
Clay Hill's picture

Does wishing for it to be more like 1929 make me a bad person?

Wed, 04/11/2012 - 17:41 | 2336043 The Alarmist
The Alarmist's picture

Depends: Are you longing for the days when hi-rise buildings had windows that opened?

Wed, 04/11/2012 - 18:10 | 2336130 Clay Hill
Clay Hill's picture

Among other things, yes

The government didn't interfere with the market, that fiasco was largely the fault of the Fed.

Unlike today, unemployment didn't reach double digits until 1932. Despite the "official" UE numbers touted in the MSM, we've been there for quite a while now.

This time around, we have a perfect storm of government intervention, and the Fed keeps juggling more balls... until they can't.

Should make one hell of a story for the grandkids.

Wed, 04/11/2012 - 16:14 | 2335770 mt paul
mt paul's picture

just keep the muppets


until dec 21 2012...

Wed, 04/11/2012 - 16:21 | 2335795 SeanJKerrigan
SeanJKerrigan's picture

I'm personally a believer in the theory that there will be a series of moderate crisises (debt ceiling showdown, bond crisis, rating agency crisis, petrolium crisis, inflation crisis, etc.) rather than one very apocolyptic one. But I'm ready to be proven wrong!

Off topic, but you might be amused to read my list of "expert" quotes on the recently passed JOBS Act.

Wed, 04/11/2012 - 16:30 | 2335799 q99x2
q99x2's picture

Arrest Greenspan before he dies. Arrest the Bernank before he says something else. Otherwise dance along to the Hokey Pokey.

Wed, 04/11/2012 - 16:25 | 2335813 Seasmoke
Seasmoke's picture
Chris Martenson:  "We Are Heading For Another 2008!"


There fixed it for you

Wed, 04/11/2012 - 16:24 | 2335815 MayIMommaDogFac...
MayIMommaDogFace2theBananaPatch's picture

What a Canute!

Wed, 04/11/2012 - 16:37 | 2335853 YesWeKahn
YesWeKahn's picture

These idiots learned nothing, because mama Bernanke want them to contine to be criminals.

Wed, 04/11/2012 - 16:45 | 2335891 Uber Vandal
Uber Vandal's picture

Looking back at the 1920's, we seem to be rhyming quite well with history.

1927 saw the housing market implosion, much like we had ours in 2007-2008.

1929 saw the market crash, much like ours did in 2009.

However, most people seem to only know of the 1929 crash, which was nothing compared to the 1932 crash, and indeed, stocks did come back up nicely in 1930.

It is my opinion that we are going to rhyme with 1932, for absolutely nothing that caused the problems of even the recent past have been fixed, only literally papered over.


Wed, 04/11/2012 - 17:48 | 2336066 lakecity55
lakecity55's picture

I think you are right. Since more money was collected into fewer hands in the 30s, why not pull the same plan again, since it obviously worked so well last time.

Jesus needs to come back and throw the money changers out of the Temple of Society. No sooner than he whipped their asses last time they snuck back in.

Devils they are, devils under a red shield.

Thu, 04/12/2012 - 06:49 | 2337084 lakecity55
lakecity55's picture

Muchas gracias, amigo! I'm sending that one to my mail list.

That photo should be hung in every bank in the world.

The Lord is like a cross to a vampire. The banksters would not enter the bank with said photo on its walls, or at least they might eschew usury.

Hmmmm. I have a big silver cross from a looting expedition in Mexico in my misspent youth. I think I'll try it on some bankers today and see what happens.

Wed, 04/11/2012 - 22:57 | 2336743 ebworthen
ebworthen's picture

And Roosevelt confiscating privately held gold in 1933 (well, attempted to).

Wed, 04/11/2012 - 16:52 | 2335907 Olympia
Olympia's picture

Global Debt Crisis

The greatest private fraud of human history.
Who are the great fraudsters who are becoming the murderers of the human kind? How does the economy "illness" threaten Democracy and the freedom of people?
By knowing what happened in indebted Greece, where loan sharks created “bubbles” and the current inhuman debt, one can understand the inhuman plan in total ...understand where this plan started just to bring all states at the same end ...understand how this type of plans are established...


Wed, 04/11/2012 - 16:54 | 2335916 dbTX
dbTX's picture

Don't worry, be happy.

Wed, 04/11/2012 - 17:00 | 2335924 Yen Cross
Yen Cross's picture

That's it? No anger or Technical/ Fundemental, Analysis?  No frustration?  You must be independantly wealthy.


Wed, 04/11/2012 - 17:44 | 2336052 The Alarmist
The Alarmist's picture

Wow! I'll pay you 2 & 20 for that strategy!

Wed, 04/11/2012 - 16:59 | 2335922 rlouis
rlouis's picture

A left coast perspective - from the so-so soverign socialist counties of the Bay Area:

Everyone in government wants desperately to hold up property values.  At the state and local level they support tax revenues, but if the value isn't there the local politicians will do their best to assess new taxes, countering much of BenBurnbankee's desperate efforts to prevent them from hitting market clearing prices.  Add to that is that investors are targets for lawyers, city councils, building departments, code enforcement departments, rental housing commissions, you name it, all trying to squeeze money out of someone who 'owns property'...

Many people with the resources have choosen to invest in rental property, personally I won't until this bankrupt state acknowledges and deals with serious fiscal problems - the risk/reward of owning rental property in Cali is, in my view, unattractive.  I am hearing, anecdotally, that some current Valley investors are trying to get out of ownership for some of the reasons mentioned above.

So, this is the thing - if owning property becomes increasingly unattractive to more people, that means less demand and lower prices. The longer it takes for them to understand this, the lower the bottom will be.  I see a possible future in which substandard housing becomes the mainstay of Amerika's working class poor.   



Wed, 04/11/2012 - 17:14 | 2335972 Clowns on Acid
Clowns on Acid's picture

rlouis - And as CA goes, so goes the rest of the country (well most of it). And will go the rest of Western Europe...therefore the Fed will print for the US banks benefit, and for the (via FX swaps) for the european banks benefit.

Thus ...the article is prescient.

Wed, 04/11/2012 - 17:22 | 2335992 rlouis
rlouis's picture

Yep, and when inflation ultimately goes haywire from printing, politicians will institute rent control.

Wed, 04/11/2012 - 17:43 | 2336049 lakecity55
lakecity55's picture

yep, wage and price controls.

The economy went socialist while we were asleep at the wheel.

Wed, 04/11/2012 - 17:04 | 2335937 tony bonn
tony bonn's picture

market manipulation in a public, policy base way goes back to 1987....

shell game, extend and pretend, market manipulation - somewhere in here is the start of a haiku if only i would focus...

Wed, 04/11/2012 - 17:06 | 2335942 yogibear
yogibear's picture

Don't worry, Ben Bernanke will save the day with more money printing and QEinfinite. That should make oil and the rest of the commodities take off again.

Bernanke's solution is to always keep debasing the US dollar. 

Be ready for $200 plus oil.


Wed, 04/11/2012 - 20:34 | 2336510 Seer
Seer's picture

"Be ready for $200 plus oil."

Or $20/bbl oil and unemployment...

Wed, 04/11/2012 - 17:23 | 2335993 Barmaher
Barmaher's picture

You had me until metastasing

Wed, 04/11/2012 - 17:41 | 2336038 lakecity55
lakecity55's picture

Hey, these same guys were dicking around in 2008. With heads of state in their pockets, "they" can do anything--

But in 2008 their hubris did not work.

It won't work the next time, and this may be the next time.

Crises during an election year let you do all kinds of neat, Bankster stuff.

Let's see what happens, but fasten your seat belt and anchor the PM box to the floor...
