The iTulip guy outdoes himself

Re-inflation Rally Part I: Falsehoods, fantasies, fabrications, and fake-outs

In the case of the U.S. in 1938 and Japan in 1992, debt-laden economies struggling with over-capacity quickly slipped back into depression once the fiscal juice wore off. Without a shred of proof to support the theory that economy-wide price fixing of capital and under-pricing of debt by governments through manipulation of interest rates cures the economic ills caused by previous price fixing and debt subsidy schemes, global Keynesian stimulus as an alternative to debt cancellation is a triumph of ideology over evidence that will end in inflationary tears. Shall we as investors go all-in with the bulls to play the intermediate results of the fiscal fantasy plan in execution — the stock market rallies and the price distortions in bonds and commodities — or a solid position for the end game with the doomers, wait it out with bars of gold, a sidearm, and a case of Scotch? Is there a rational position to take between these extremes?

Alas, his answer to that last question is reserved for paying subscribers. Still a fun read.

In the vast, raging deluge of falsehoods, fantasies, fabrications, and fake-outs that passes for news in the U.S., the river of informational sewage that collects in drips and spews from ducts and runoff of coin operated media outlets, occasional shimmering snippets of verified truth from immaculately credible sources bob improbably among torrential turd-waves of propaganda, hoopla, and fluff.

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Everything is entertainment in America: the Somalis pirates, the President’s dog, Mexican drug wars, Paris Hilton, the mass destruction of a generation’s savings, Susan Boyle, and the looting of our treasury each get equal coverage. Scratch that. We’ll hear more about the dog, Paris, and Susan, but at least Susan deserves it. The crash itself provided a hot new topic for doomertainment; economic collapse, like a war the American government started raging in some distant country that most Americans cannot find on a map, is an abstract concept here.

Also via iTulip, do not miss this interview with William Black. “Geithner has a record of being a failure at every step of his career.”