Did U Think The Ponzi Scheme Would Last?

CIT's Failure Could Threaten Financial Sector's Overall Recovery

What a laughable title for your article. You should have called it "Can CIT BK be the catalyst for the popping of the banking sucker's rally?".

To call what has happened over the past 6 months a "recovery" is to not know your a$$ from a hole in the ground. Almost every important metric except tier 1 capital ratio has gotten much worse and the only reason that metric got "better" was accounting tricks enabled by the softening of mark to market rules.

The banking fundamentals have continued to implode lead by falling home prices and rising unemployment. Credit card defaults have increased and late or missing payment recidivism after mortgage "workouts" have proven to be the norm. The consumer is broke and not likely to recover any time soon. Boomers have finally started to worry about their retirements and so they are going to keep the cash they have and walk away from underwater homes.

Recovery? Suuuuuuure there has been a recovery. After all, didn't Bernanke and Geither and Obama tell us the "recession" is over? Anyone who believes this crap is a total patsy.

Six Signs Economy Is Turning the Corner

I'm going to let you in on a little secret. The global financial system is bankrupt. In addition, when you talk about taxpayers paying for this or that bail out you are badly mistaken since our government has no money and neither do taxpayers. No, the bailouts are not being paid for they are being financed with more debt. This debt absolutely ensures that the US is a debt slave going forward and thus cannot recover. This is a debt death spiral.

Let me give you another hint. The trend for the markets and the economy is still down. This is but a monster sucker's rally within the broader meltdown but within 2-3 months the meltdown will resume. Elliott wave followers call this rally Primary 2 and they predicted it would happen in advance and then called the start of it nearly to the day. Folks like Prechter said it would be the biggest rally of the meltdown yet and that it would fool many sheeple into believing the meltdown was over. In reading your post I guess he was right again.

After Primary 2 ends will come Primary 3 - a massive collapse which will lead to lower lows. It will occur because the debt that has already gone bad and yet has been hidden on bank balance sheets will begin to stink so badly that no amount of kitty litter will cover it up. Once the stench becomes unmaskable then the truth will come out and it will crash the system. Again, the debt is already bad its just that accounting tricks have been allowed to cover it up and kick the can down the road. But you can't fool all the sheeple all the time and sheeple are beginning to awaken.

Just remember back to the crash of 29-32 and all the times that people thought it was bottoming and turning around. Each time they were wrong.

Welcome to the great depression of 2009.