I really do struggle to paint pictures with the treasury "monthly EMA 100 line in the sand", the inverted H&S on the long bond and other means of trying to communicate what is so obviously a huge drama developing in the US financial markets. Never mind the Euro zone - which is quite capable of blowing itself up on its own - for just a moment and focus on the US, great financial and military superpower that it is.
[Side note: Has anyone seen 'America: The Story of US' on the history channel? I could not take my eyes off it last night as it dramatically illustrated the revolution against British tyranny from start to finish. I couldn't help being struck by how far off the track modern America is now, becoming some might argue the antithesis of what the colonists fought for.]
Meanwhile, there is the debt; always the debt. Nouriel Roubini explains here:
“Eventually, the fiscal problems of the U.S. will also come to the fore,” Roubini said during the panel discussion. “The risk of something serious happening in the U.S. in the next two or three years is going to be significant” because there’s “no willingness in Washington to do anything” unless forced by the bond markets.
We will either live beyond our means and suffer the inflationary consequences as Washington continues to monetize debt (at ever more punitive rates) or this phase of the exercise in greed and denial ends in a deflationary event so that the Wizard may reload his inflation gun.
In the newsletter I have got to be cold and calculating to eventually beat 'them' at their own game. On the blog I can be whoever and however I want to be, because nobody pays me for these opinions. So speaking as the blogger, it pisses me off watching this mess hurtle toward one event or the other, a bigger picture and very dark inflationary one or a short term painful, longer term needed deflationary one.
And it's all because we have institutionalized living beyond our means.
