So what happens on Tuesday ? Holidays and a vacation from reality is over boys.
The baboons who yank mindlessly at the financial levers face a grim choice.
The
big bad boyz on the block, the banks, brokers and bullshit merchants
from Bishopsgate to Canary Wharf – the crafty feckers created and
traded fraudulent “securities”. The dozy, hedonistic, gullible,
credulous losers , who borrowed too much money trying to get rich
quick, or trying to live like the millionaires they admire so much on
the idiot box in the corner of their heavily hocked hutch.
They
can take the high road of moral hazards – let them sink (because sure
as hell they are never going to swim against this tide of fiscal
imprudence) suffer the consequences of their bad choices. Maybe they
could (if they can find a dock big enough) prosecute some of the
culpable bankers and corporate executives – starting with that bunch of
criminals at Northern Wreck.
OR
Accept the never ending
capacity for cowardice , let these losers off the hook, wreck the whole
machinery of capital by debasing the medium of exchange.
The
Treasury, the FSA, The Bank and their claques in the Press can't face
the losses, so for now they've apparently decided to wreck the currency.
3 months ago 67 pence would buy a Euro, today you need 79pence – a devaluation against our major trading partners of 19%.
But
these blinkered bankers and their cheerleaders in the press have had a
temporary reprieve in the financial markets. This reckless gang of
bankers have been able to lick their wounds and lick Lord Kings
backside as he promises even more Niagara's of funds to stave off the
meltdown.
Much has been made of the “false” rumour that HBOS
were in trouble – my god, every scribbler on Threadneeedle Street was
blogging, writing columns that these nasty shysters were trying to
bring the market down – did anyone ask the dreadful question – was HBOS
bust ?
Hell NO. The shock and the recognition that many big
institutions, household names, are worse than flat broke and are
therefore powerless to conduct normal operations is something that the
boneheads in the City cannot, will not, dare face.
Flat broke,
means that all those RMBS (Residential Mortgage Backed Securities) are
slowly deflating … that deflation has a quickening pace. The
non-payment stage is moving inexorably to defaults and onwards to
repossessions on a grand scale.
Even if Lord King with his
helicopters drops more money every week £5Bn.. £6 BN… bailing out
feckless mortgage holders, the “lie to buy” …ers, everything will hit
the buffers when we have to disassemble who owns what . Diced and sliced, mixed and re-mixed, in a toxic token of debt, shuffled around
like a parcel at a party these “securities” off-loaded onto countless
dupe “investors” ranging from municipal funds in obscure corners of
foreign nations to countless public employee retirement plans.
All
secured by the legal systems of Trusts held in those centres of
financial probity in the Dutch Antilles, Cayman islands, Virgin
Islands, and a little nearer home, the festering pits of money jugglers
in Jersey, Gurnsey and the Isle of Man.
What do we do on Tuesday ?
As
the margin call is made on the market, as the sucking chest wound
absorbs the helicopter funds like the surgical swabs soak up the blood,
the flat line buzzer will buzz as the folks in intensive care stare
desperately at the flickering screen.
Businesses will shutter, payrolls, empty, families evicted.
There
will be a lot of pissed off little people out there who put their faith
in banks, big business and and prayed as they filled in their Lotto
cards weekly.
This is what it looked like in Boca Raton last week when they couldn't be assured of housing funds …
I tell you, the speed of this is going to astonish everybody.
UPDATE D Telegraph 24.3.08 Fed's rescue halted a derivatives Chernobyl by Ambrose Evans Pritchard
HatTip Postman Patel
