Helping to explain “the bezzle”

“the bezzle” as in embezzlement. which in some opinions has become the underlying basis for the market and thus the reason everything is screwed up. helpfully explained here at the market ticker as told in an editorial by Karl Denninger.

he starts with giving us some examples of what it looks like

Here are some examples of “The Bezzle”:

  • Liar loans: The borrower can’t possibly pay off the loan on the original agreed terms and the institution that makes the loan “passes it” to an investor fully aware that the borrower almost certainly lied about credit capacity.
  • Overly-rosy projections about growth in property values: The speaker is either incompetent (doesn’t understand exponents – a fundamental mathematical concept) or is intentionally deceiving people.
  • Overly-rosy projections about the stock market: “The market always comes back” and “over long periods of time it outperforms other investments.”  Both true, but both misleading; if you’re 18 you might be able to wait for it to come back, but the market has remained flat to down from a given level for more than 20 years before.  How long did you say it was before you intended to retire?
  • “The Internet is doubling every three months!”:  It was – for about six months.  But that got embedded into the business plans of thousands of businesses, long after the growth rate had started to slow down to something more sustainable.  Oh by the way, the fundamental lie of that claim is that in 7 years  the Internet would have gone from its original two people to covering more than the entire population of the planet, including the rice farmer in China and the starving child in Bangladesh.

Then dives into what has been happening that has gotten us to this point. making good notes of how it was predictable and how people did see it coming like the appraisers petition that goes back to 2000 for the government to do something . Also, he goes over some of the ass covering done by the assholes like Bernanke and his weak excuses for himself and predecessor Greenspan not doing a thing to stop this bullshit aswell as the two faced republicans opining about Obama’s bailouts while convenently ignoring their own faithful participation in the TARP(or taxpayer anal rape program as some have dubbed it)

Its great and all to be looking at what is really going on that the MSM wont touch but it always comes back to knowing just how bad things can/will get. Dennenger’s last quite sobering thought:

Government is not responsible for the fraud, but it is responsible for turning its head and refusing to look, investigate and prosecute.

Government profited from the increased tax revenue and “fake wealth” that was “created” as a consequence of The Bezzle, and the campaign bribes, er, contributions that flowed from it.

Now government must choose – either put a stop to The Bezzle, here and now, or watch the market dismantle it piece by piece, firm by firm, and deal with the collateral damage – another 10-20 million unemployed (at minimum) and a Depression worse than the 1930s.


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