Via Karl Denninger's Market Ticker blog


Step back for a second and remove the name "America" from where this is happening.

Walk up to a random person and describe all of the above (summarized directly below), leaving the name off.

Massive liquidity injections made to cover up the intentional lying of financial institutions, refusal to declare a loss when its a loss, a property bubble (intentionally blown by that nation's central bank through willful blindness to what amounts to a gigantic ponzi scheme in the credit markets) that has popped and is dragging down values by more than 20% in a single year's time (with no bottom in sight), 97% of the auctioned properties going back to lenders because they rigged the bidding and refused to accept the offered amount, and a government where literally millions of dollars in bribes, er, "campaign contributions" are made by PACs set up by the very companies that are doing the lying - and a government that not only allows this to go on but gives some parts of this den of thieves preferential tax status.

Then add in that virtually every large financial institution in the nation has intentionally moved billions of dollars of "assets" into a bucket called "Level 3" not because they can't get a price but because they didn't like the price they were quoted. So instead of recognizing the value (or lack thereof) that the market says these assets have (and which, by the way, is right in line with what has happened to them in previous recessions) they instead simply stuff them in the closet and stick a wholly-made-up price tag on them, calling that their "value". Oh, and then these same firms pay their executives bonuses based on these claimed "values"!

Finally, in the financial sphere, some of these firms allegedly "sell" off tens of billions of loans for 90 cents on the dollar, but they finance the purchase, yet account for it as a "true sale", and oh by the way, those loans were originally made to the same people who bought them back. The accountants wink, nod, and call this an "arms length" business transaction.

Due to all of this intentional fraud and deceit that nation's currency has declined in value by 40% in the last three years and is still falling, with some market analysts predicting a further 30% decline in the next year or two, and a full 10% of that currency decline has occurred in the last three months.

The nation's people have figured it out, driving consumer confidence to generational lows. They are being laid off at the rate of tens of thousands a month, yet the government claims that unemployment is modest and the nation's economy is "fundamentally strong."

Finally, tell them that this nation claims inflation is running "3%" (and adds that to their senior citizens entitlement checks) when over the last year meat has gone up in price by 30%, milk 35%, eggs have doubled, gasoline and diesel have doubled, and some basic crude goods have gone up in price four times over (e.g. flour) Add to this that this same government has mandated that 30% or more of the corn being grown be turned into fuel and put into the fuel tank of that nation's cars, driving these price increases in foodstuffs even harder.

To a man these people would call that nation crooked, corrupt, a "banana republic."

They would call their stock market "rigged" and "impossible to invest in with any sort of rational basis."

They would call their politicians and businesspeople "crooks", "thieves", "liars" and worse.

They would lament that the population was being fleeced, ripped off, swindled and screwed.

They would compare that nation to Germany prior to the rise of Adolph Hitler, Argentina and Venezuela.

Welcome to America 2008 folks.


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