Blog on the Run: Reloaded

Monday, August 31, 2009 8:21 pm

Q: What’s the matter with bubbles?

Filed under: We're so screwed — Lex @ 8:21 pm
Tags: ,

A: Eventually, they all pop. Which hasn’t prevented China from going ahead and blowing one up anyway. I noted before that that appears to be the case. But now? They’re flat-out admitting it and daring anyone (read: the SEC) to do anything about it:

In a phenomenal demonstration of frankness and true economic assessment, the head of the China Investment Council, Lou Jiwei, who controls China’s $298 billion sovereign wealth fund, admits the ponzi nature of today’s markets:

Both China and America are addressing bubbles by creating more bubbles and we’re just taking advantage of that. So we can’t lose.

Indeed, they can’t lose thanks to the criminal silence on behalf of Mr. Jiwei’s US financial counterparties. It doesn’t get any simpler than that folks. Keep in mind Madoff was thrown in jail for a few hundred years for much less: what’s $55 billion when you are dealing with a $20 trillion+ global equity market Ponzi scheme. And yet both China and the US continue their struggle to perpetuate a Ponzi, with the full implicit backing of all financial, regulatory and legal authorities. The system is now officially broken, even ignoring the conspiratorial ramblings of fringe bloggers. …

One wonders at what point the US authorities will have the guts to at least admit what China is now openly saying is one big pyramid scheme. And as for the Fed’s prudent approach to fighting bubbles – well, that is now completely discredited, as the only goal for the US Federal Reserve is to make sure that Wall Street’s “VIP club” manages to cash out before all the stupid money and other retail investors, presumably before all hell breaks loose, and the latest bubble pops once more. Good luck to all.

Any ideas on just where we’re supposed to put our money so that it doesn’t just disappear when the next balloon pops?

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1 Comment

  1. Ideas? Yes. Suitable for Polite Company? Not quite so much … .

    Comment by Jasbro — Wednesday, September 9, 2009 1:35 pm @ 1:35 pm


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