Nov 30, 2011

Well we got the news event. A coordinated action by every central bank in the world to lower the cost of dollar-funding to big global banks following on yesterday’s ratings downgrade to a couple dozen of those same banks. Another kick of the can pretending that the problem is illiquidity rather than insolvency. It illustrates well how the world works now.

If you are Big M$%F$%# GlobalBank and your credit rating drops, then Big M$%^F$%^ CentralBank will lower your cost to incur additional debt. If you are anyone else and your credit rating drops to junk, you are shut off from all credit and are headed for bankruptcy. Too Big Too Fail means Just The Right Size To Subsidize.

No surprise that equity markets gapped up massively at open. Squeezing the weak shorts of the big financials who don’t realize that the world’s central banks (and most Western governments) are completely and utterly owned by those same banks. Combined with what has been a couple of surprisingly resilient economic indicators in the US, we may be in for a short/sharp rally.

Longer-term, this really is getting near the last call to get out of ALL financial assets denominated in fiat currencies. There is no safe haven fiat currency and there is ZERO safe haven for a minnow anywhere in any financial market rigged by the sharks. They will have no hesitation in stealing everything – if they aren’t already. And they are NOT subjects of the law anymore. They ARE the law. I do like food, physical PM’s, energy – but not the industrial commodities. If you are in debt, you are now screwed (unless you are one of the kleptos/cronies). If you are looking for safety within the system, you will soon be breakfast.