Fitch: "China credit bubble is unprecedented"

The UK Telegraph reports that Fitch credit rating service says,"The credit-driven growth model is clearly falling apart. This could feed into a massive over-capacity problem, and potentially into a Japanese-style deflation".

Well, what a shock.  Well, not really.  In fact, I've written many times and for several years now that China would prove to be a massive credit bubble the likes of which the world has never seen.  For example, here is a post indicating Chinese credit bubbles from 2010.  Here is another.  And in this post I applied Ponzi logic to it so that readers can know that it was all done on purpose even if supposedly with good intentions.

It's not that the leaders of all the nations are stupid thus causing them to make poor financial decisions.  It's that they are mortal humans.  Mortals die some day and so in the Keynesian spirit of "in the end we are all dead", why not get what you can while you can even if you have to stab your fellow human in the back?  Humans are greedy and selfish by nature.  This is why it has never worked out well for normal people to let other people be in charge of them.  This is why we must all be sovereign individuals come what may.   Self sovereignty does not guarantee safety.  Nothing guarantees safety.  But it does promote freedom and that is about all you can ask for in this life: freedom to determine for yourself how you will live it.

The government corruption always starts out slow.  A favor for a campaign donor here.  A kickback accepted for political favor there.  But all of it always justified in the minds of the con men because of the other good stewardship that the politicians think they are doing.  Of course, eventually their human nature pokes through and over time they figure out how to game the money supply (which is really just a proxy for human labor) and they use it for outright treasonous theft which is really a hidden form of slavery. 

That is where all governments of the world are today.  If you do anything they don't like, it's a felony.  The recent NSA leaks debacle shows that it's a felony even if what they don't like about you is that you told the truth about them.  On the other hand, if they do something horribly immoral then perhaps they need to be furloughed with pay for a couple weeks (which I call "vacation") while the sheeple forget all about the wrongdoing.  And if that doesn't work then offer a heartfelt (fake) apology and, hey, perhaps suggest more training for the government felons so they don't repeat it.  After getting used to complacency of the masses, the con men at some point don't even try to hide their wrongdoings.  They don't even feign remorse or embarrassment.  They simply say "NSA spying is not an invasion of your privacy and besides we need it to save you from terror".  Folks, that's where we are today and it is really sad to see.

Very soon government is going to have to make a decision.  They will either have to decide to reform themselves and make do with faaaaaar less than they have today or they will have to become outright tyrants; they will have to do something in order to justify martial law.  The other option is to start a world war and to hope that the people are too stupid to hold the con men accountable.  They will have to decide not because they want to but because the credit Ponzi which supported their scammy ways will have collapsed.  They won't be able to borrow money in order to fuel their political ambitions cheaply and perhaps not at all.

It's very hard to tell who is going to implode first - Japan, China, the EU, Russia, or the US.  Perhaps it will all happen very quickly for all players once any large player defaults.  The one thing I am sure of at this point is that there is no escaping massive global economic pain and no doubt a BUNCH of social unrest.  I am shocked by the number of people who have gotten caught over the past few months stockpiling pipe bombs in their houses.  For example, this and this and this. For every one that gets caught, 50 remain. 

There is going to be serious unrest all over the world, including the US.   I don't know what will kick it off here but it will just be 1 too many straws on the camel and there will be no taking it back.  There is really no way around it.  A massive debt bubble bought people's complacency and calmed them down.  When it all goes away I expect the opposite effect.  When it happens, have no doubt: those to blame are named Greenspan, Bernanke, Clinton, Bush (everyone named Bush who was ever in government), Cheney, Obama, Paulson, Every present and past executive in JP Morgan and Morgan Stanley and Goldman Sachs, and of course every executive in Monsanto, etc.  And let's not forget our shadow bankers like Jack Welch, etc.   In other words, our government and corporate "leaders" for the past 40+ years.  They all sold us down the river.

When it all comes tumbling down it's really going to leave a mark.