Arraya: And here come those pesky toxic assets again. The Fed has knowingly slurped up billions in near worthless assets, all in the hopes of sustaining confidence in the system as a whole. The ECB is in a similar position, having acquired massive amounts of valueless bonds, also in the hope of pushing the illusion of a solvent Eurozone.

While the truly clueless discuss debt monetization, the real focus needs to be on the value of the debt itself. We’ve been gorging on debt globally for years, but the reality is, there is little of true value underpinning the whole enterprise. There is no “there” there.

I’m watching China. When that place goes, its gonna get real ugly, real fast.