Derivatives are going to take a lot of people down as Europe collapses. J.P. Morgan is just the first of many investors that will lose billions on “bad bets” which are a code for the heavily leveraged derivative market.

From WSJ:

The losses stemmed from wagers gone wrong in the bank’s Chief Investment Office, which manages risk for the New York company. The Wall Street Journal reported early last month that large positions taken in that office by a trader nicknamed “the London whale” had roiled a sector of the debt markets.

The bank, betting on a continued economic recovery with a complex web of trades tied to the values of corporate bonds, was hit hard when prices moved against it starting last month, causing losses in many of its derivatives positions. The losses occurred while J.P. Morgan tried to scale back that trade.

J.P. Morgan was willing to take these risks because their losses have been socialized by government policy while profits are still private. In other words Liberal corporatism has created a system where the tax payers pick up the tab for these bad investments – no doubt purposefully so that we began clamoring for true nationalization. The reality is that we cannot afford to pay off these trillions owed in the derivative market so look for our slow motion decent into third world status to pick up steam in the coming months as more banks need “bailouts” from a broke American public.

Jim Rogers is the one voice of financial sanity in a world turned upside down by neo-Marxist fantasists and their manipulation of the economy. Here he’s talking about what the Obama administration is creating, which he declares is a “Inflationary holocaust” that will destroy almost all American’s way of life. He’s talking about a period after deflation – which is happening right now. About 2013 seems to be his time frame for the inflation to really kick in:

Here’s another video where he puts the date of this “holocaust” somewhere in 2013:

So are you ready for prices on everything you buy to quadruple or more?

Some liberal troll used the contact form to tell me, using childishly vulgar terms, my “ilk” will be sorry for trying to undermine the great job Obama has done “saving” our economy from evil capitalism. I won’t bother to publish or respond to his numerous, conspiratorial points but I will say for the record there is no economic recovery and America has slipped into second world status so smoothly most people haven’t realized it yet. Here’s the real deal:

Via Mish we have some staggering numbers about unemployment:

In the last year, the civilian population rose by 3,638,000. Yet the labor force only rose by 945,000. Those not in the labor force rose by 2,693,000.

The Civilian Labor Force fell by 342,000.

Those “Not in Labor Force” increased by 522,000. If you are not in the labor force, you are not counted as unemployed.

Those “Not in Labor Force” is at a new record high of 87,419,000.

By the Household Survey, the number of people employed fell by 169,000.

All this adds up to an actual unemployment rate of around 11% at least if the government wasn’t cooking the books.

The Daily Economist points out that the Fed can’t even accurately measure this data because the numbers have surpassed the parameters the Feds use to create their charts.

Over five million people, that’s 5,000,000, have gotten on disability since Obama took office. As David Rosenberg notes “…either safety standards at work have eroded dramatically or the “99%” have found a creative way to milk the system and turn the economy into a quasi welfare state”

The Asian Development Bank just announced it see the end of the dollar as the world’s reserve currency happening soon. This is because they see the dollar as becoming essentially worthless.

Small businesses, those little mom and pop shops the “99%” claim to support, aren’t hiring because of the bad economy.

Americans are too broke to file for bankruptcy.

Americans are storing their cash in home safes rather than banks because the risk of a bank implosion far outweighs the pittance of interest savers can earn.

California bankruptcies increased 557% from 2006-2011 and there’s no sign of improvement. In fact demographic data for the state suggests things will get much worse.

Every week 330 farmers leave their land for good. This is a famine in the making as industrial agriculture requires too much energy to maintain a centralized food production business that can feed the entire country.

The Obama administration is systematically destroying the remaining family farms through environmental regulations.

The standard of living urban liberals enjoy – and think the government can provide for all – is actually completely unsustainable.

But hey, Obama said he fixed things so they’re fixed. Time to celebrate!