Tuesday, September 22, 2009

CALLING A SPADE A SPADE

Total credit mkt debt as % of GDP has risen to 375% !!!

Then keep in mind in 1930 the value was 265%. Reversion to the mean followed for years after.

Then think about what Jim Grant just said. Think about the ONLY expansion in debt is coming at the FED level. Think about the K wave.

Think about for Grants chirp to be right….the level of 375% (already a wild record) would have to rise SUBSTANTIALLY !

Is there enough money in the world to even make it so?

The ONLY conclusion I can make is we are either in a Japan scenario and its only 1990 ish or it’s like 1929-1932 and it’s only 1930 or BOTH.

Someone PLEASE explain to me, how we ramp the shit up, when we already have amazing SLACK? We’ll build even more factories in CHINA?

The remaining employed will feel JIGGY and pick up slack for the more than 7 MIL getting no paychecks? But don’t we even have to do better than that?
If we have $80 SPX earnings anytime soon……I’ll eat something disgusting….

Break to new lows in 2009 below the 2002 lows tells me we are somewhere inside a SECULAR BEAR…how far or how long current rally goes is not of my direct concern…..when the game is over…..how low will be.

Duratek

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