Timing

Karl Denninger writes a great post today. Here’s his conclusion, a correct one in my opinion. We’re in for a big hurt. This ‘big hurt’ is coming from a number of directions, and this day’s warning comes from the economic front.

Be forewarned, adult language. The full article can be found here and is well worth reading.

You want an exact time when it will come apart?

I don’t have it.

Neither does anyone else.

I didn’t know precisely when it would blow up in the summer of 2007 and I don’t this time either. But what I do know is that the math is never wrong and that despite all the bullshit and games eventually the cash flow always wins.

Unlike the 2008 collapse I don’t think you’re going to get any warning at all this time around. The reason is that the gearing that has been taken on and the bets being placed are several times as large as those of the last time.

The distortions in the economy today, net-on-net, are nearly triple what we saw in 2007.

If 2007 was a pipe bomb in relative terms, this is a jar of nitroglycerine and the guy carrying it both has a bum leg and is walking through a swarm of hornets.

How ‘ya like those odds, sucker?

If you want to trade – bull or bear – then have at it. Plenty of money to be made there, if you’re quick and nimble.

But if you’re investing in this market today then your bet is that the government can borrow and spend a trillion or more beyond tax receipts in perpetuity, that cash flow will never catch up with the banksters, and that none of the nations currently in trouble (such as Greece) will actually default.

That’s your wager in a nutshell, and IMHO those trying to get you to either be or stay involved here have motives that have absolutely nothing to do with your financial success.

Down the road don’t say you weren’t warned – because you just were.