Will 2012 and 2013 usher in the End Game?

By Tyler Durden
If Raoul Pal was some doomsday spouting windbag, writing in all caps, arbitrarily pasting together disparate charts to create 200 page slideshows, it would be easy to ignore him. He is not.

The founder of Global Macro Investor previously co-managed the GLG Global Macro Fund in London for GLG Partners, one of the largest hedge fund groups in the world. Raoul came to GLG from Goldman Sachs where he co-managed the hedge fund sales business in Equities and Equity Derivatives in Europe...

Raoul Pal retired from managing client money in 2004 at the age of 36 and now lives on the Valencian coast of Spain, from where he writes." It is his writing we are concerned about, and specifically his latest presentation, which is, for lack of a better word, the most disturbing and scary forecast of the future of the world we have ever seen....

And we see a lot of those.

Consider this:

We are here...
We don’t know exactly what is to come, but we can all join the very few dots from where we are now, to the collapse of the first major bank…

With very limited room for government bailouts, we can very easily join the next dots from the first bank closure to the collapse of the whole European banking system, and then to the bankruptcy of the governments themselves.

There are almost no brakes in the system to stop this, and almost no one realises the seriousness of the situation.

The problem is not Government debt per se. The real problem is that the $70 trillion in G10 debt is the collateral for $700 trillion in derivatives…

Yes, that equates to 1200% of Global GDP and it rests on very, very weak foundations

From an EU crisis, we only have to join one dot for a UK crisis of equal magnitude.

Then do you think Japan and China would not be next?

Then do you think the US would survive unscathed?

That is the end of the fractional reserve banking system and of fiat money.

It is the big RESET.

It continues:

• Bonds will be stuck at 1% in the US, Germany, UK and Japan (for this phase).
• The whole bond market will be dead.
• Short selling on bonds - banned
• Short selling stocks – banned
• CDS – banned
• Short futures – banned
• Put options – banned
• All that is left is the Dollar and Gold

It only gets better. We use the term loosely:

We have around 6 months left of trading in Western markets to protect ourselves or make enough money to offset future losses.

Spend your time looking at the risks of custody, safekeeping, counterparty etc.

Assume that no one and nothing is safe.

After that…we put on our tin helmets and hide until the new system emerges

And the punch line

From a timing perspective, I think 2012 and 2013 will usher in the end game

WHY I AM NOT A DISPENSATIONALIST; John Nelson Darby is recognized as the father of dispensationalism later made popular in the United States by Cyrus Scofield's Scofield Reference Bible. Charles Henry Mackintosh, 1820–1896, with his popular style spread Darby's teachings to humbler elements in society and may be regarded as the journalist of the Brethren Movement. CHM popularised Darby more than any other Brethren author. As there was no Christian teaching of a “rapture” before Darby began preaching about it in the 1830s, he is sometimes credited with originating the "secret rapture" theory wherein Christ will suddenly remove His bride, the Church, from this world before the judgments of the tribulation. Dispensationalist beliefs about the fate of the Jews and the re-establishment of the Kingdom of Israel put dispensationalists at the forefront of Christian Zionism, because "God is able to graft them in again," and they believe that in His grace he will do so according to their understanding of Old Testament prophecy. They believe that, while the methodologies of God may change, His purposes to bless Israel will never be forgotten, just as He has shown unmerited favour to the Church, He will do so to a remnant of Israel to fulfill all the promises made to the genetic seed of Abraham. I am not a dispensationalist; it is unbiblical.