Rocketstar has a question

And his question is seriously, holy shit, how bad can it get?

Well, now. "It" can get preeeeeeeeety bad. Like, oh, I don't know, this bad.

It probably won't get quite to that level, mind you. Karl Denninger is the former head of a computer company and now a trader by, um, trade. To make your living off the markets, as this man claims to, is quite a trick, especially when it's these markets you're trying to live off of. Methinks there are a few things he's not telling us.

Actually, I know there's a few things he's not telling us. For instance, he doesn't substantiate any of his doomaggeddon. Not in that post. He does have a couple of other posts that demonstrate to my satisfaction he's not an outright crank--don't look at those latter posts if you have a weak stomach.

It probably won't get to the level he's prophesying, at least an Orlov Stage 3 collapse. (I find it interesting, and more than a little alarming, that Orlov characterizes a stable Stage 1--the first step--as a Great Depression.) It would take, as Orlov notes, a concerted effort to drag the economy down each level. 

Then again, Washington seems determined to exert whatever effort it can to that end. Consider the trillions of dollars earmarked for "bailouts"...that have had almost no effect on the economy so far, and will inevitably have a nasty effect once the world collectively realizes all that money's been conjured out of thin air. 

They're still acting as if this is a normal, albeit severe, cyclical downturn in the economy. They're pretending not to notice that we've deliberately built our entire economy on quicksand--basically, money conjured out of thin air at every level. They're pretending not to notice this because to acknowledge it would incite a revolution, complete with Wall Street lamppost gallows.

It has to be said, people are waking up. We're starting to hear long overdue questions, like how exactly will we spend our way out of debt? and what exactly will you do with all that money? I've even heard how much is enough--a question so anathema to the "American Dream" that anyone who dared to ask it even a year ago was branded a pinko commie and probably put on a list.

So no, I don't think it'll get that bad. I don't think. But it could. And if we continue to overlook the systemic fraud and shovel fake 'money' hither and yon, it probably will.