read this – Basically, It’s Over – By Charles Munger – A parable about how one nation came to financial ruin. – Slate.com
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How Long, To The Point Of No Return? – David Merkel – Alea posted a paper, and The Big Picture a slideshow on sovereign debts, by the same author. (<has links) … The main point of the paper is that we are past the point of no return in most major nations, without significant changes that would diminish living standards for some time. Add the implicit obligations to the explicit debt, and there is quite a mountain to climb. Defaults are coming, the only question is what nations will default. – more thoughts at – The Aleph Blog
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CPI Number Reported INTENTIONALLY INCORRECT? – Carl Denninger – … Rather, it is virtually certain that this "reported" value was in fact intentionally false, and the persons doing so were too clumsy to "fix" the evidence behind it so that it would "add up." … – Market Ticker
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Wealth Disparities Approach the Levels of the 1920’s – This graph was an eye opener for me (not that I should be surprised): – has more comments – Housing Time Bomb
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The Pain in Spain – By John Mauldin –
Germany, Greece, and Spain; Two Views on the Euro; The Pain in Spain
How Much Is Too Much? – … and to close, I want to show a chart from today’s Wall Street Journal, from a column by Daniel Henninger. … This is the definition of an unsustainable path. Spending has grown 7 times as much in real (inflation-adjusted) terms as median household income over the last 40 years … - Thoughts Form The Frontline
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huss1 Notes on a Difficult Employment Outlook – John P. Hussman, Ph.D. – … Moreover, the share of employed individuals who are employed full time has also dropped by 3 percentage points, resulting in a significant contraction of employment activity. Even this would not be a difficulty had we not also vastly expanded the debt burden on the average family since then. … Simply put, current employment levels are incongruous with servicing existing levels of household debt. … – Hussman Funds
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Loans Beat Bonds for First Time in Four Years: Credit Markets – By Emre Peker and Alan Goldstein – Leveraged loans are outperforming high-yield, high-risk bonds after lagging behind the last four years as the Federal Reserve takes steps to withdraw the unprecedented amount of cash it pumped into the economy. – Bloomberg BusinessWeek
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Don’t Panic over China’s US Treasuries Sales – by Philip Bowring – … However, this thinking both grossly exaggerates the degree of leverage that China has through its treasury holdings, and invents a political driver behind what was most probably a technical adjustment, not a fundamental change in China’s reserves policy … more thoughts – Asia Sentinel