Jackson Jambalaya

Denninger writes with acid yet again, cutting through the BS, telling Americans some things the media and politicians are not willing to say:
"today we learned that The Fed has lost control of the Effective Fed Funds Rate - their own overnight lending rate. They were forced to change their interest rate on reserves in order to try to get it back under control - and there is no reason to believe their efforts will be effective.....
Treasury will have to issue three trillion dollars of new debt over the next 12 months in an attempt to make this work. But Treasury has been using very short-term debt - mostly four week and 13 week "bills", to fund the existing debt, because they are cheaper. As such the total amount of these auctions could easily reach five trillion dollars over the next 12 months.
Already, Treasury is issuing more than $100 billion dollars in this debt a week, on average, including new issues and rollovers. This is about double the total amount of debt that foreigners (or US interests) hold in total, and we have barely begun to actually issue the debt necessary to make the "TARP" operate.
We are, in effect, borrowing to pay interest. If you have ever tried to do this personally, you know that doing so almost always leads to bankruptcy......
I believe Treasury has been attempting to "kick the can down the road" as is the usual pattern in Washington DC.
Unfortunately the can has filled up with cement and there is now a very high probability that instead of the can being able to be kicked down the road until next year after the elections the second-level dislocation - the "big one" - is going to happen within days. ..."
http://market-ticker.org/archives/623-The-Stark-Choice-Now-Facing-America.html
Someone made a snarky comment last week about my posting Denninger's columns on a regular basis. I am doing so for several reasons. I think he has a very valid point of view which needs to be considered. The media has consistently gotten this whole story wrong and the debate over the Bailout proved most politicians either don't care about this problem or if they do, it's too complex for most of them to understand. I think the two institutions, the media and our political leadership, have consistently failed the American people. If you read Mr. Denninger's predictions for 2008 nearly a year ago, he completely nailed everything that's happened in the markets and economy this year. He was also one of the few people who read the Bailout Bill. As I read it, I was able to confirm his analysis and everything he said would happen after it was passed took place. When it comes to the issue of the transparency of balance sheets, he is one of the few voices bringing it up as Bernanke and Paulson try to fight a forest fire with a garden hose. Keep reading his posts, you'll learn more from him than from the hacks or money honeys.