The Zombie Ponzi II: Good Luck

clipped from www.zerohedge.com Out of the $2.22 trillion in expected 2010 issuance, $200 billion will be absorbed by the Fed while QE continues through March. Then the US is on its own: $2.06 trillion will have to find non-Fed originating  demand. To sum up: $200 billion in 2009; $2.1 trillion in 2010. Good luck. And while things are hair-raising in "gross" country (not Bill...at least not yet), they are not much better in netville either. Net of maturities, 2010 coupon issuance will be about $1.8 trillion, a 45% increase from the $1.3 trillion in FY 2009 (and the paltry $255 billion in 2008). What options does this leave for the administration? Very few, and all of them are ugly. As we stated earlier on, the options for the Fed are threefold: Announce a new iteration of Quantitative Easing. Prepare for a major increase in interest rates. Engineer a stock market collapse. We very well may have passed into the stage where blind growth is the only alternative to a complete collapse. We hope that is not the case.