But how close are we from having this happen again? Having a crisis like 2008 happen again? The truth is, none of us know how things are going to play out, and how this massive explosion in debt over the past 40 years is going to work itself out. However, anyone who thinks or wants to believe that things are "ok" and that policymakers and bankers have things "under control" should take a look back to 2008 -- as we have -- and watch some of the speeches made by George Bush, Hank Paulson, Ben Bernanke, and members of Congress like Chris Dodd, Barney Frank and Nancy Pelosi for some context: for a reality check. During that time, the "failure of congress to act" cost the Dow a record 778 points in one day. We were told that "we had to act" and that though the president and his staff believed in the free market, this was just not the time for principle. The crisis proved, beyond a shadow of a doubt, that the Emperor had no clothes...and it is our contention that he is still butt naked! Indeed, our addiction to debt, stifled in the private market of mortgage backed securities and collateralized debt obligations, was rolled over onto the public balance sheet. The government picked up its spending where the private sector dropped it off. No meaningful reforms were made, and three years later, we are not only on government life support and zero interest rates by the federal reserve, but under general anesthesia. We are motionless, and in suspense...waiting...but for what? Well, to help us answer this, we bring on Karl Denninger of Market-Ticker to help us. We will go back in time with him and revisit some of these issues, and ask the question "what has really changed, and what can we expect from a system built from faulty assumptions and broken promises?"
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