Monthly Archives: September 2011

The Logic Of Cycling

Silicon Graybeard discusses cycling as a cardio training mode.

Whatever mode you choose, do at least an hour of cardio this weekend.

And enjoy the good old days while they last.

Follow The Money

Read this piece as posted at Jim Sinclair’s place.

Go black market as much as you can.

Use something other than the US dollar as the medium of exchange.

You’ll need the practice.

ZeroGov: Understanding The Difference Between Classic Liberty & Modern Freedom


Why do we fight?

And towards what end?

W.H. Auden: September 1, 1939

by W.H. Auden

I sit in one of the dives
On Fifty-second Street
Uncertain and afraid
As the clever hopes expire
Of a low dishonest decade:
Waves of anger and fear
Circulate over the bright
And darkened lands of the earth,
Obsessing our private lives;
The unmentionable odour of death
Offends the September night.

Accurate scholarship can
Unearth the whole offence
From Luther until now
That has driven a culture mad,
Find what occurred at Linz,
What huge imago made
A psychopathic god:
I and the public know
What all schoolchildren learn,
Those to whom evil is done
Do evil in return.

Exiled Thucydides knew
All that a speech can say
About Democracy,
And what dictators do,
The elderly rubbish they talk
To an apathetic grave;
Analysed all in his book,
The enlightenment driven away,
The habit-forming pain,
Mismanagement and grief:
We must suffer them all again.

Into this neutral air
Where blind skyscrapers use
Their full height to proclaim
The strength of Collective Man,
Each language pours its vain
Competitive excuse:
But who can live for long
In an euphoric dream;
Out of the mirror they stare,
Imperialism’s face
And the international wrong.

Faces along the bar
Cling to their average day:
The lights must never go out,
The music must always play,
All the conventions conspire
To make this fort assume
The furniture of home;
Lest we should see where we are,
Lost in a haunted wood,
Children afraid of the night
Who have never been happy or good.

The windiest militant trash
Important Persons shout
Is not so crude as our wish:
What mad Nijinsky wrote
About Diaghilev
Is true of the normal heart;
For the error bred in the bone
Of each woman and each man
Craves what it cannot have,
Not universal love
But to be loved alone.

From the conservative dark
Into the ethical life
The dense commuters come,
Repeating their morning vow;
‘I will be true to the wife,
I’ll concentrate more on my work,’
And helpless governors wake
To resume their compulsory game:
Who can release them now,
Who can reach the dead,
Who can speak for the dumb?

All I have is a voice
To undo the folded lie,
The romantic lie in the brain
Of the sensual man-in-the-street
And the lie of Authority
Whose buildings grope the sky:
There is no such thing as the State
And no one exists alone;
Hunger allows no choice
To the citizen or the police;
We must love one another or die.

Defenseless under the night
Our world in stupor lies;
Yet, dotted everywhere,
Ironic points of light
Flash out wherever the Just
Exchange their messages:
May I, composed like them
Of Eros and of dust,
Beleaguered by the same
Negation and despair,
Show an affirming flame.

Fred On Everything: A Culture In Regression

Fred Reed muses on the accelerating Endarkenment.

Ready for the New Thirty Years’ War?

Barnhardt: There’s No Way In Hell We’re Making It To November, 2012

From Ann Barnhardt:


Here is a piece from that hopefully will make you all understand, once and for all, that this ain’t the 1930’s, and that there is absolutely no way in hell that this Republic is going to make it to November 2012.


Summary: The five largest banks in the U.S. (JP Morgan Chase, Citibank, Bank of America, Goldman Sachs and HSBC) are carrying $238 TRILLION dollars in derivative exposure. JP Morgan alone is carrying $78 TRILLION in derivative exposure BY ITSELF.

Okay, what the hell is derivative exposure? What this is referring to are over-the-counter non-exchange traded forward delivery (or “futures”) contracts of various kinds. I am a futures broker, but I only execute futures contracts on the futures exchanges, namely the Chicago Mercantile Exchange and the New York Mercantile Exchange. About ten years ago a new “novelty” emerged in the futures business – the so-called “over-the-counter” contracts. There was a kid in the office I worked in who got wind of this and had all kinds of stars in his eyes about making a killing off of these “OTC” contracts because the brokers’ commissions were not a flat fee but a percent of the contract value. Here’s the problem with OTC contracts: there is no exchange standing between the buyer and seller as a guarantor.

In my business, when a customer executes a trade on a futures or options contract, it makes no difference who the other guy is on the other side of the trade, be it executed electronically or in the pit. None of us have to worry for a second about the counterparty on our executions because the EXCHANGE ITSELF stands between ALL transactions as the ultimate guarantor. The exchange then enforces the financial requirement rules with the Clearing Houses, the Clearing Houses enforce the financial requirement rules with the brokers, and the brokers enforce the financial requirement rules with the customers. That is the chain of financial responsibility. So, even if a customer bugs out and fails to financially perform on a contract, the contract WILL BE MADE GOOD by extracting the money from the broker, then the Clearing House and finally the Exchange. This massive enforcement buffering is what gives the system integrity.

OTC contracts have no exchange. They are a flipping free-for-all. If someone bugs out on a contract, the poop hits the fan. The counterparty has their pants around their ankles and the broker is caught in the middle. That’s why when that kid in my office years ago got all starry-eyed, I thought to myself, “I wouldn’t do that OTC crap if you put a gun to my head – no matter what the commissions were. It would be Russian Roulette. Eventually someone would default and it would financially destroy the broker instantly, and perhaps the counterparty as well.”

Let’s take my business – cattle futures. One contract is 40,000 pounds of live cattle. The spot contract settled at $119.725 per hundred pounds today. So, 40,000 pounds X $1.19725 (shift the decimal) = $47,890 total value of the contract. Since this is an exchange traded instrument, the customer doesn’t really don’t have to worry about default and can go ahead and book that $47,890 today, and it will be offset at a later time, and the net of the entry and exit will be the P&L. The contract isn’t going to default, so the derivative exposure is limited.

Okay. These banks are carrying these OTC futures contracts with NO exchange to guarantee anything. And they are carrying these contracts largely WITH EACH OTHER. So JP Morgan might be the long and Goldman Sachs, or some insolvent bank in Europe is the short on the other side. If these banks default, which is now a mathematical certainty because they are not only insolvent, but insolvent multiple times over and there isn’t enough money in the world to bail them out, there is going to be a cascading default on all of these OTC contracts.

Now look at the value and exposure of these OTC derivatives again: the top 5 banks in the US alone have exposure of $238 TRILLION dollars.

The total GDP of the United States is $14.5 Trillion.

The total GDP of China is $6 Trillion.

The total land mass on earth is 36.8 billion acres. If every acre of land on earth was “sold” for $6467 per acre, that would total $238 Trillion.

JP Morgan BY ITSELF has derivative exposure equal to over FIVE TIMES the value of the entire US GDP.

And no, there will not be a 1:1 offsetting in a collapse, because the collapse will be asymmetrical, and the bankrupt party will first pursue FULL payment on its “longs” (think of these as accounts receivables) while its “shorts” (accounts payable) will only pay out 20 cents on the dollar OR LESS. In other words, these entities will tear each other apart in a mad dogfight and this dogfight will take the entire world down with it.



AND THE MASSIVELY CORRUPT AND INCOMPETENT SECURITIES REGULATORS, BOTH GOVERNMENTAL AND PRIVATE, SAT BY AND WATCHED THIS HAPPEN. That is what happens when you let a group of criminals run a bureaucracy of affirmative action hires to “audit” the financial industry. Scroll down and read my post titled “There Must Be A Reckoning.”

It’s over. There is no coming back from this. The only thing that can happen is a total and complete collapse of EVERYTHING we now know, and humanity starts from scratch. And if you think that this collapse is going to play out without one hell of a big hot war, you are sadly, sadly mistaken.

Here [video clip at top – WRSA] is an intellectually honest trader who was interviewed this morning by the BBC. As much as you may not want to believe it, what this guy says is correct.

This iteration of human civilization is approaching an end.

Do It

Alvie discusses this statement today by Governor Bev Perdue of North Carolina:

“You have to have more ability from Congress, I think, to work together and to get over the partisan bickering and focus on fixing things. I think we ought to suspend, perhaps, elections for Congress for two years and just tell them we won’t hold it against them, whatever decisions they make, to just let them help this country recover. I really hope that someone can agree with me on that. The one good thing about Raleigh is that for so many years we worked across party lines. It’s a little bit more contentious now but it’s not impossible to try to do what’s right in this state. You want people who don’t worry about the next election.”

See also this other Drudge gem from the last several hours, in which Citigroup stooge, Council on Foreign Relations commissar, and former Obama White House OMB Director Peter Orszag:

argues for more concentrated political power amongst the ruling Elite.

Do it, you bastards.

Then do it again.

Alea iacta est.

Gunwalker: FreeFor PsyOps

David explains.

Keep firing until the target changes shape or catches fire.

Do It If You Want To Live

PT, that is.

John Robb’s Global Guerrillas links two paths to greater strength and endurance:

100 Pushups

Couch-to-5K Running Plan

Even though you are not training, the people who will come to kill you and your family are.

No excuses.

No slack.


Denninger links to this Paul Craig Roberts recap of the global economy’s past twenty years.

PCR goes moonbat in the last graf (Dead Elephants are as devoted as Dems to the wealth redistribution/social welfare/”safety net” system), but it is overall an excellent executive summary of how we got here.

Pass it along.

VDH: A Look Back

The Prof places the ongoing Collapse into context.

Not that it makes it any better.

Gunwalker: The Plot Thickens




TL Davis: This Is A Dead Republic


It is coming.



DumpDC posts something unusual – a specific warning.

George Ure and his crew at UrbanSurvival are also concerned.

Adjust or maintain your threat boards as you see fit.

AP: The Quality Of Quantity

Arctic Patriot speaks the unspeakable about an American “partner”.

Don’t worry, though.

They are here to help.


JohnGaltFLA explains.

Any questions?

The Essential Question

(graphic courtesy of totallynotadrian via Vanderleun)

Please view this speech by Elizabeth Warren, then read Jerry Pournelle’s commentary on same.

Me? I’m with Billy Beck on “social contracts”.

Produce a copy of it, with my authentic signature on it, and then we can talk.

Until then, I’ll wonder just one thing about Warren and others of her ilk.

Will they shred?

And by the way, campers, you do know that the US military will ultimately be the enforcers of the Federal tax laws and the resulting upcoming excitement, right?

It’s an American tradition.

Whose Side Are You On?

Please read the text and comments at this Belmont Club post prior to watching the Keynes/Hayek rap-off above.

Are you a controller, or do you stand for freedom?

And what are you willing to do about it?

These people see you as a slave and believe that you will do nothing meaningful to stop them.

Your call.


Just played old guy on the airsoft range for a day-and-a-half, including a night op that wrapped at 0000 today.

AAR/LL to follow later in week.

First key lesson?

More cardio.

TL Davis: We Are A Divided People

Read it all.

This will not end well.

But it most certainly will end.

Let’s win.