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News Link • Conspiracies

Karl Denninger: The Roof Is On Fire

Worldwide governments have borrowed and spent huge percentages of their GDP in a puerile attempt to protect a criminal class that has looted the public and bribed the legislature - THE BANKS. There was always a point where this would fail, but it is flatly impossible for anyone to know exactly where it was beforehand. But mathematically, there was a point where it would fail. The gamble that Bernanke, Trichet, Obama, Bush, Paulson, Geithner and everyone else in the world took is that we could do this for a short period of time and that in doing so private demand would pick up and return us to "stability." THESE PEOPLE DID NOT STUDY THE ABOVE CHART, AND THEY'RE F^#KING IDIOTS FOR BELIEVING THAT WHICH WAS TRIED IN 2003-2007, WITH A HIGHER DEBT LOAD THAN WE HAD THEN, WOULD WORK NOW WHEN IT FAILED IN 2003. Failed? Yes, FAILED. O'Neill was on Bloomberg the other day. He was Bush's Treasury Secretary during part of his first term, until he resigned under pressure from the administration. Why did he resign in 2002? BECAUSE HE KNEW THAT WHAT THE BUSH ADMINISTRATION WAS DOING WOULD NOT WORK. A study he ran in 2002 showed that the United States would be running budget deficits of more than $500 billion going forward, and that to fix it we would have to enact an across-the-board tax increase of more than 60% or radically cut entitlement spending.

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