The Blue Bus is Calling Us

SUBHEAD: If short-term borrowing is unavailable, things could go south very quickly - even to food arriving at the supermarkets.

 By James Kunstler on 21 November 2011 for Kunstler.com -  
(http://kunstler.com/blog/2011/11/the-blue-bus-is-calling-us.html)

 
Image above: The Blue Bus tinted by Juan Wilson from photo "Zoo Bus Epica" by Kevin Harkness. Click to enlarge. From (http://www.newtribez.net/Harko127/photo/view/27-01327-zoo-bus-epica-cmyk-jpg).

Zeez European politicians unt economists all zound like rocket scientists wiss all zeir charming euro-chatter. But zey must be quite dumb to machen zuch an unglaublich scheiße sturm of zee système financier. Che cazzo è?

Surely all the pretending nears its dire conclusion. Everybody is broke and everybody is in hock up to his prefrontal lobes and everybody is whirling around the drain over in the grand continental theme park of lovely cities and great eats. I'm sorry, but I don't see how they can stop the hemorrhaging as we slide into the season of holiday enchantment.

Every bank (and its uncle) is dumping everybody's sovereign bonds as though they were discovered to be croissants imported from a leper colony. Feh...! Folks of all stripes and accents desperately seek to move their money to some safe harbor - but where is this cozy mooring?

To the US for the moment perhaps; but what happens Monday morning when the markets react to the weekend news that the US Senate super-committee has been utterly unable to agree on decisive action that would forestall the scheduled massive automatic budget cuts built into this red-white-and-blue doomsday machine - not to mention the ratings agencies threats to knock UST-paper down another notch upon such failure. Oy yoy yoy!

Just to be plain here: nothing is working. The global system of accounting control fraud has completely unraveled. Nobody will lend money to anybody anymore because everybody suspects everybody else is lying about their ability to meet any obligation. The whole world has become a daisy chain of schnorrers and schmiklers. All those hundreds of trillions of dollars in credit default swap insurance (ha!).

Worthless and pointless, because now that a Greek default of at least 50 percent, officially, has failed to ignite a payout, then no default will. Instead, you'll just get cascades of un-hedged defaults. All the lawyers who ever lived could litigate until the sun turns into a red dwarf and they will never resolve these swindles, and the money represented in them will be so far gone that not even Ray Kurzweil in full Singularity mode will encounter a trace of it in his eternal travels through a zillion parallel universes.

So much for the hedge fund industry. I hope the folks who ran those cute operations enjoyed their years in Fairfield County, Connecticut, and Saddle River, New Jersey, because in a few weeks they'll be disguising themselves as OWSers in some makeshift urban encampment in order to line up for three-day-old bagels. Personally, I look forward to test-driving a few $5000 "must-sell" pre-owned Lamborghini Sesto Elementos, not that I'd actually buy one. The nimble might even score some bargain beachfront property in the Hamptons.

It's been about a fortnight now since John Corzine's MF Global fund went up in a vapor, including a reported $800 million or so (rumored to be actually more like $2+ billion) filched out of clients portfolios that cannot be accounted for - though there are additional rumors that it constituted a batch of collateral that was liquidated a micro-second after its arrival at JP Morgan, which had lent Corzine's firm enough money to buy the rope that it hung itself with. Notice, the story has completely disappeared from the mainstream news media (while the Kardashians soldier on).

Even poor Gerald Celente, chief of the Trends Journal forecasting group, arch-nemesis of "the white-shoe boys" got snookered in the action when MF Global somehow ended up with custodial care of the Gold ETFs Gerald was collecting and his shit just vanished! I heard him fulminating over it on a podcast and he is not somebody I'd want to be on the bad side of. Up until now, Celente was only commenting on the prospects for revolution in the streets. Now, I daresay, he'll be out in front leading it (or perhaps rappelling down Jamie Dimon's security wall with a straight razor clenched in his teeth).

The MF Global case has fast-tracked the evaporation of trust in all the places, large and small, where American One-percenters stash their cash. The redemption orders must be flying through their transoms like radioactive black swans. By lunchtime tomorrow this could include all the TBTF banks. That's what the pundits mean by "contagion." Where will that money go now (if they can get it out)?

I don't see where else it can go now except to shiny yellow and white metal, and maybe some oil positions. But the mechanisms of the precious metals trade have also been monkeyed with, and you'd best be careful where you place your order. As for oil, if lending really does seize-up, then letters-of-credit will not be issued and tankers will not be moving any product. More to the point, the global revolving debt system has depended on colossal transfers of ultra-short-term borrowed money. If short-term borrowing is simply unavailable, things could go south very quickly - and by that I mean food stops arriving at the supermarkets, which hold just a three-day supply. Wouldn't that make for an interesting Thanksgiving?

I have admittedly painted an extreme picture this week. But this week presents the most extreme convergence of events the world has seen since September of 2008, and perhaps a good bit worse.

The End

This is the end Beautiful friend This is the end My only friend, the end

Of our elaborate plans, the end Of everything that stands, the end No safety or surprise, the end I'll never look into your eyes...again

Can you picture what will be So limitless and free Desperately in need...of some...stranger's hand In a...desperate land

Lost in a Roman...wilderness of pain And all the children are insane All the children are insane Waiting for the summer rain, yeah

There's danger on the edge of town Ride the King's highway, baby Weird scenes inside the gold mine Ride the highway west, baby

Ride the snake, ride the snake To the lake, the ancient lake, baby The snake is long, seven miles Ride the snake...he's old, and his skin is cold

The west is the best The west is the best Get here, and we'll do the rest

The blue bus is callin' us The blue bus is callin' us Driver, where you taken' us

The killer awoke before dawn, he put his boots on He took a face from the ancient gallery And he walked on down the hall He went into the room where his sister lived, and...then he Paid a visit to his brother, and then he He walked on down the hall, and And he came to a door...and he looked inside Father, yes son, I want to kill you Mother...I want to...fuck you

C'mon baby, take a chance with us C'mon baby, take a chance with us C'mon baby, take a chance with us And meet me at the back of the blue bus Doin' a blue rock On a blue bus Doin' a blue rock C'mon, yeah

Kill, kill, kill, kill, kill, kill

This is the end Beautiful friend This is the end My only friend, the end

It hurts to set you free But you'll never follow me The end of laughter and soft lies The end of nights we tried to die 

This is the end Words and music by Jim Morrison and the Doors (http://www.oldielyrics.com/lyrics/the_doors/the_end.html)

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