WOULD THAT I WERE BEATING A DEAD HORSE. But I don't think so. In fact, I believe the above drawing absolutely captures the treacherous walk to fiscal sobriety our country and the developed nations (G7) of the world would be on if we were willing to rein in spending and roll up our sleeves to tackle the gargantuan, growing deficits and feel our pain now. Tragically, the quick-fix, puerile Obama administration seems to be going backwards, away from fiscal sanity and the difficult choices it embodies. It's called 'recovery through the power of the monetary printing press' and through raising taxes. It gives us only a short-term illusion of well-being. But when spending is only increasing at exponential levels, this is a walk towards true disaster, leading to a deadly fall from such heights to such depths that none of us really want to fathom how it will unfold. So we hide our eyes and refuse to watch or listen. And live like there's no tomorrow or piper to pay.
Zero Hedge puts it this way:
For Greece, with on and off balance sheet liabilities at over 800%, it's game over. For the Eurozone, with the same ratio at about 500%, it is also game over. For the US, at 500%+, it is, you guessed it (sorry Joseph Stiglitz), game over, but since we have the printers, it will simply take a little longer. Following up on yesterday's popular post on prevailing delusions as captured by Albert Edwards' colleague Dylan Grice, we present Albert's latest outlook. Please don't read this if you want to keep believing there is any hope left for the (developed) world.
Pretty raw stuff in direct contrast to the softer, more sanguine stories in the MSM and on conservative Internet. ZH is savvy, sophisticated, blunt and we ignore its wisdom at our great peril. We don't need to panic, but we do need to prepare as best we can. I'll talk more about that over the course of coming weeks and link to what I consider good sources.
Image/Similar View, The Economist