America’s March Toward Cyprus Status

Karl Denninger @ The Market Ticker:

It’s coming folks.

The sort of disruption you’re seeing in Cyprus, with outright confiscation of bank deposits and brokerage accounts, especially retirement assets such as 401ks and IRAs.

Here.

In America.

Within two years.

How do I know?

Because the precedent has already been set, and you, the common American, sat for it.

You allowed the GM bailout to take place where the seniority of bondholders was ignored and they were screwed while the UAW was made whole.

You allowed Obamacare to be passed with the Congress denoting it was a “fine” rather than a Tax, because Congress knew that a direct, unapportioned tax was unconstitutional — and then you satagain when Judge Roberts of the USSC rewrote Obamacare to be that very same unconstitutional direct Tax.

You allowed John “I’m a traitorous jackass” McCain to suspend his campaign to make sure TARP passed, then you cheered both him and Obama for shoving that piece of crap legislation down Congressional throats,and just two weeks later you returned nearly all of the people who voted for it to office.

You still allow people like John Boehner to make the following sort of statement without showing up outside his office and home and refusing to leave until he resigns in disgrace:

House Speaker John Boehner broke from some Republicans on Sunday when he agreed with President Obama and other Democrats who say the country does not have an immediate debt crisis.

“We do not have an immediate debt crisis,” the Ohio Republican said on ABC’s “This Week.”

In a word, bullcrap.

It’s not a crisis when your outstanding debt goes from $6 trillion to $16 trillion in ten years, far more than a double, and what’s worse is what is causing the escalation — medical expense — and you won’t even talk about derailing the policies that you put in place that made this happen?

Like hell.

In two years federal medical spending along with Social Security and interest will, on current paths, reach the total of all tax receipts.

At the outside the market will realize that Congress will never address the underlying issue with medical care because they have steadfastly refused to do so.  At that point we will have become Greece and Cyprus.

For those who say that our banking system is “strong” and “not corrupt unlike Cyprus” may I ask what the record is on money laundering and intentional obfuscation of the truth with regard to firms such as HSBC and Wachovia (both of which were caught laundering enormous amounts of money) and JP Morgan (which was just grilled, along with the regulators, regarding the “London Whale”) and not one person or institution has been indicted and prosecuted?

There is about $20 trillion in US Retirement “assets.”  A “small” 10% “one time” tax levy on those assets would fund the US Deficit a couple of years from now, and I will go out on a limb now and predict that exactly that will be done.

Of course the “one time” aspect will be a lie too, but you’ll lap that one up as well just like you have all the others.

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