Welcome to Bizarro America! The World of Liberalism and the Left

What happened to the America we all once knew and loved? The land of - baseball, hot dogs, apple pie and Chevrolet. The land of the free and the home of the brave. 

A country where its citizens felt safe and happy and proud to proclaim, “God bless America!” It seems like those noble ideals which made our country strong and great are rapidly slipping away and being replaced by the strange and bizarre. As some of our readers may recall, the Bizarro World was a fictitious planet in the DC comics universe, first appearing in the early 1960s. 

In the world of "Htrae" ("Earth" spelled backwards), society is ruled by the Bizarro Code which states, "Us do opposite of all Earthly things! Us hate beauty! Us love ugliness! Is big crime to make anything perfect on Bizarro World!”

So without any further ado we say,

Welcome to Bizarro America (or "Acirema”)....

- Where our country was founded by Fascists, Socialists, and Secular Materialists.

- Where abortion, godless immorality, slothfulness and base secularism are called virtuous and protected as constitutional rights.

- Where the ACLU, Planned Parenthood, Pro - Choice, the Gay Lobby, and Leftist College Professors are called righteous advocates, noble and just.

- Where Harry Reid, Nancy Pelosi, Al Gore, Barack H. Obama, John Kerry, Hillary and Bill Clinton are great and virtuous statesmen.

- Where Hollywood, The Kardashians, Lady Gaga, Madonna,  Kanya West, MTV and the mother who has an abortion or a child out of wedlock are virtuous role models for our youth.

- Where the American flag, capitalism, the Tea Party and private enterprise, personal morality and Judeo/ Christian values are viewed as evil hate and abhorred.

- Where people like Sarah Palin, Ronald Reagan, Abraham Lincoln,Rush Limbaugh, Jim Vicevich, and the Lord Jesus Christ (Who is Almighty God the Son) are wicked and evil haters (Isa 5:20).

Political Correctness has destroyed this great nation and has made right and wrong obsolete.

This is the delusional world of the reprobate mindset of the secular liberals in America today. They slander and vilify any and all that do not line up with their Bizarro American vision for this country (Rom. 1:18-32, Jude 1:10). They label by slanderous accusations those who practice morality and believe in Divine absolutes (e.g., natural and spiritual laws), going so far as brading them as haters, cold-hearted, evil, intolerant, racist and their always favorite tag: Nazis. They are extremely motivated by envy, desperately and defensively driven to push their Bizarro ideology on the will of the American people. They are “180 degrees backwards” in all of their ideology and rationale, which are devoid of any truth. Their subjective, sensual, carnally dominated ideology rejects the concept of absolute truth in all forms (spiritual, moral and natural). Thus, these secular Leftists deny and distort facts that are proven, information that is clear-cut and conclusions that are obvious to any reasonably minded individual. Slander and defamation is their only recourse in any discussion much like their fallen spiritual father (Psalm 49:20; 92:6; 1 Cor. 1:27-28; Philip. 3:18-19; James 3:14-16; 2 Peter 2:12; Jude 1:10).

This is the delusional world of the reprobate mindset of the secular liberals in America today. They slander and vilify any and all that do not line up with their Bizarro American vision for this country.

This thinking is nothing new today; this ideology has dominated the world even before the creation of the World. It appeared first in Almighty God’s RIGHTEOUS Heaven where Lucifer and his angels rebelled against pure (undefiled) REALITY, thus abandoning ETERNAL (spiritual) absolutes for a godlessdelusion (Isa. 14:12-17; Ezek. 28:11-19; John 8:44; 1 John 3:8). It next appeared in the Garden of Eden(Genesis 3); then in the days of Noah (Genesis 7-8); after that at Babel where its inhabitants rejected Divine revelation for a delusion, which continues until this day (Gen. 11:1-9; John 3:19; Rom. 1:18-32).

The grand conclusion of this madness is coming up in the near future and will be the apex of the upside down, “Bizarro” mindset under Lucifer’s global fascist, the Anti-Christ (2 Thess. 2:7-12). Lucifer and his lawless minion will institute a secular lawless movement of global proportions in “the Abomination of Desolation” or “The Image of the Beast” (Dan. 9:27; Rev. 13:14-15)and “the Mark of the Beast” (Rev. 13:16-18). This apocalyptic movement will be the pinnacle of the abandonment of absolute reality and truth. The end result of this delusion will be the eternal ruin and damnation of billions (Rev. 19:19-21; 20:11-15). (Chart link)

Hear what Almighty God - the Author, Designer and Creator of the cosmos and all spiritual and natural laws governing Heaven and Earth - has to say about these reprobates:

Woe unto them that call evil good, and good evil; that put darkness for light, and light for darkness; that put bitter for sweet, and sweet for bitter! (Isaiah 5:20).

For the wrath of God is revealed from heaven against all ungodliness and unrighteousness of men, who hold the truth in unrighteousness(Rom. 1:18).

He that justifieth the wicked, and he that condemneth the just, even they both are an abomination (a vile stench) to the LORD (Proverbs 17:15).

And this is the condemnation, that light is come into the world, andmen loved darkness rather than light, because their deeds were evil (John 3:19).

Ye are of your father the devil, and the lusts of your father ye will do. He was a murderer from the beginning, and abode not in the truth, because there is no truth in him. When he a lie, he speaketh of his own: for he is a liar, and the father of it (John 8:44).

The liberal, secular movement of today is and has been accelerating at an exponential rate. It now dominates all facets of government, the media and the entertainment industry in the U.S.A. It is going to dominate the world coming up very soon under Lucifer’s Anti – Christ (The Man of Lawlessness) The social and cultural landscape in America today is a wasteland polluted with the refuse of "Bizarro” thinking and ideology. How can we as a nation survive?

In the midst of godless social engineering and a nation on the verge of collapse, the God of TRUTH is the only TRUE refuge today. Do your part as an Founding Father American with all your heart but do not trust in the end results.

My dear friend, Conservatives also need to possess a saving faith in Almighty God. A life that is morally upright and socially upstanding still falls short of the glory of God (Rom. 3:23; Eph. 2:8-9). Even conservatives can possess a "bizarro" thinking mindset when it comes to the RIGHTEOUSNESS demanded by Almighty God and a saving faith to Jesus Christ (Rom. 10:2-4, Gal. 1:4, Eph. 2:8-9).

In these days of truly "Bizarro” thinking and backward values, may you be sure that you know the God of TRUTH, and if you do already, may we all allow Him to guard and keep our hearts and minds in His perfect and wondrous peace (Philip. 4:7).

Therefore whosoever heareth these sayings of mine, and doeth them, I will liken him unto a wise man, which built his house upon a rock: And the rain descended, and the floods came, and the winds blew, and beat upon that house; and it fell not: for it was founded upon a rock(Matt 7:24-25).

Build wisely my dear friends and see rightly!

The Kingdom of heaven is truly at hand!

DJP I.F.

Credit to the Ignorant Fishermen Blog

QE Worked For The Weimar Republic For A Little While Too

There is a reason why every fiat currency in the history of the world has eventually failed. 

At some point, those issuing fiat currencies always find themselves giving in to the temptation to wildly print more money.  Sometimes, the motivation for doing this is good.  When an economy is really struggling, those that have been entrusted with the management of that economy can easily fall for the lie that things would be better if people just had "more money".  Today, the Federal Reserve finds itself faced with a scenario that is very similar to what the Weimar Republic was facing nearly 100 years ago. 

Like the Weimar Republic, the U.S. economy is also struggling and like the Weimar Republic, the U.S. government is absolutely drowning in debt.  Unfortunately, the Federal Reserve has decided to adopt the same solution that the Weimar Republic chose.  The Federal Reserve is recklessly printing money out of thin air, and in the short-term some positive things have come out of it.  But quantitative easing worked for the Weimar Republic for a little while too. 

At first, more money caused economic activity to increase and unemployment was low.  But all of that money printing destroyed faith in German currency and in the German financial system and ultimately Germany experienced an economic meltdown that the world is still talking about today.  This is the path that the Federal Reserve is taking America down, but most Americans have absolutely no idea what is happening.

It is really easy to start printing money, but it is incredibly hard to stop.  Like any addict, the Fed is promising that they can quit at any time, but this month they refused to even start tapering their money printing a little bit.  The behavior of the Fed is so shameful that even CNBC is comparing it to a drug addict at this point...

The danger with addictions is they tend to become increasingly compulsive. That might be one moral of this week's events.

A few days ago, expectations were sky-high that the Federal Reserve was about to reduce its current $85 billion monthly bond purchases. But then the Fed blinked, partly because it is worried that markets have already over-reacted to the mere thought of a policy shift.

Faced with a choice of curbing the addiction or providing more hits of the QE drug, in other words, it chose the latter.

So why won't the Fed cut back on the reckless money printing?

Well, as Peter Schiff recently noted, Fed officials seem to be convinced that any "tapering" could result in the bursting of the massive financial bubbles that they have created...

The Fed understands, as the market seems not to, that the current "recovery" could not survive without continuation of massive monetary stimulus. Mainstream economists have mistaken the symptoms of the Fed's monetary expansion, most notably rising stock and real estate prices, as signs of real and sustainable growth. But the current asset price bubbles have nothing to do with the real economy. To the contrary, they are setting up for a painful correction that will likely be worse than the one we experienced five years ago.

As I have written about previously, the Federal Reserve is usually very careful not to do anything which will hurt the short-term interests of the financial markets and the big banks.

But at this point the Fed is caught in a trap.  If it continues to pump, the financial bubbles that it has created will get even worse.  If it stops, those bubbles will burst.  But as Doug Kass noted recently, it is inevitable that these financial bubbles will burst at some point one way or another...

"Getting in was easy. Getting out—not so much. The Fed is trapped and can't end tapering or else the bond and stock markets will blow up. The longer this continues the bigger the inevitable burst."

In essence, we can have disaster now or disaster later.

But most Americans don't care much about what is happening on Wall Street.  They just want economic conditions to get better for them and for those around them.  And to this day, the mainstream media continues to sell quantitative easing to the American people as an "economic stimulus" program by the Federal Reserve.

So has quantitative easing actually been good for the U.S. economy?

Not really.

For example, while the Fed has been recklessly printing money out of thin air, household incomes have actually been going down for five years in a row...

What about employment?

Don't more Americans have jobs now?

Actually, that is not the case at all.  Posted below is a chart that shows how the percentage of working age Americans with a job has changed since the year 2000.  As you can see, the employment to population ratio fell from about 63 percent before the last recession down to underneath 59 percent at the end of 2009 and it has stayed there ever since...

So where is the "employment recovery"?

Can you point it out to me?  Because I have been staring at this chart for a long time and I still can't find it.

So if quantitative easing has not been good for average Americans, who has it been good for?

The wealthy, of course.

Just check out what billionaire hedge fund manager Stanley Druckenmiller told CNBC about quantitative easing the other day...

"This is fantastic for every rich person," he said Thursday, a day after the Fed's stunning decision to delay tightening its monetary policy. "This is the biggest redistribution of wealth from the middle class and the poor to the rich ever."

"Who owns assets—the rich, the billionaires. You think Warren Buffett hates this stuff? You think I hate this stuff? I had a very good day yesterday."

Druckenmiller, whose net worth is estimated at more than $2 billion, said that the implication of the Fed's policy is that the rich will spend their wealth and create jobs—essentially betting on "trickle-down economics."

"I mean, maybe this trickle-down monetary policy that gives money to billionaires and hopefully we go spend it is going to work," he said. "But it hasn't worked for five years."

Sadly, Druckenmiller is exactly correct.

Since the end of the last recession, the Dow has been on an unprecedented tear...

Of course these stock prices have nothing to do with economic reality at this point, but for the moment those that are making giant piles of cash on Wall Street don't really care.

Sadly, what very few people seem to understand is that what the Fed is doing is going to absolutely destroy confidence in our currency and in our financial system in the long-term.  Yeah, many investors have been raking in huge gobs of cash right now, but in the long run this is going to be bad for everybody.

We have now entered a money printing spiral from which there is no easy exit.  According to Graham Summers, the Fed has "crossed the Rubicon" and we are now "in the End Game"...

If tapering even $10-15 billion per month from $85 billion month QE programs would damage the economy, then we’re all up you know what creek without a paddle.

Put it this way… here we are, five years after 2008, and the Fed is stating point blank that the economy would absolutely collapse if it spent any less than $85 billion per month. This admission has proven just how long ago we crossed the Rubicon. We’re already in the End Game. Period.

Most Americans don't really understand what quantitative easing is, and most don't really try to understand it because "quantitative easing" sounds very complicated.

But it really isn't that complicated.

The Federal Reserve is creating gigantic mountains of money out of thin air every month, and the Fed is using all of that newly created money to buy government debt and mortgage-backed securities.  Over the past several years, the value of the financial securities that the Fed has accumulated is greater than the total amount of publicly held debt that the U.S. government accumulated from the presidency of George Washington though the end of the presidency of Bill Clinton...

The same day that the Federal Reserve's Federal Open Market Committee announced last week that the Fed would continue to buy $40 billion in mortgage-backed securities (MBS) and $45 billion in U.S. Treasury securities per month, the Fed also released its latest weekly accounting sheet indicating that it had already accumulated more Treasuries and MBS than the total value of the publicly held U.S. government debt amassed by all U.S. presidents from George Washington though Bill Clinton.

To say that this is a desperate move by the Fed would be a massive understatement.  We have never seen anything like this before in U.S. history.

And look at what all of this wild money printing has done to our money supply...

In many ways, the chart above is reminiscent of what the Weimar Republic did during the early years of their hyperinflationary spiral...

Just like the Weimar Republic, our money supply is beginning to grow at an exponential pace.

So far, complete and total disaster has not struck, so most people think that everything must be okay.

But it is not.

In a previous article, I included an outstanding illustration from Simon Black that I think would be extremely helpful here as well…

Let’s say you’re at a party in a small apartment that’s about 500 square feet in size. Then suddenly, at 11pm, a pipe bursts, starting a trickle into the living room.

Aside from the petty annoyance, would you feel like you were in danger? Probably not. This is a linear problem– the rate at which the water is leaking is more or less constant, so the guests can keep partying through the night without worry.

But let’s assume that it’s an exponential leak.

At first, there’s just one drop of water. But each minute, the rate doubles. So by 11:01pm, there’s 2 drops. By 11:02, 4 drops. And so forth.

By 11:27pm, there’s only six inches of standing water. Yet by 11:31pm, just four minutes later, the entire room is under nearly 8 feet of water. And the party’s over.

For nearly half an hour, it all seemed safe and manageable. People had all the time in the world to leave, right up until the bitter end. 11:27, 11:28, 11:29. Then it all went from benign to deadly in a matter of minutes.

Are you starting to get the picture?

What the Federal Reserve is doing is systematically destroying the U.S. dollar, and the rest of the world is starting to take notice.

Why should they continue to lend us trillions of dollars at super low interest rates when we are exploding the size of our money supply?

It is simply not rational for other nations to continue to lend us money at less than 3 percent a year when the real rate of inflation is somewhere around 8 to 10 percent and reckless money printing by the Fed threatens to greatly accelerate the devaluation of our currency.

When QE first started, the added demand for U.S. government debt by the Federal Reserve helped drive long-term interest rates down to record low levels.

But in the long-term, the only rational response by all other buyers of U.S. government debt will be to demand a much higher rate of return because of the rapid devaluation of U.S. currency.

So QE drives down long-term interest rates in the short-term, but in the long-term the only rational direction for long-term interest rates to go is much, much higher and in recent months we have already started to see this.

The only way that the Fed can stop this is by increasing the amount of quantitative easing.

Right now, the Fed is buying roughly half a trillion dollars worth of U.S. Treasuries a year, but the U.S. government issues close to a trillion dollars of new debt and must roll over about 3 trillion dollars of existing debt each year.

If the Federal Reserve eventually decides to buy all of the debt, then interest rates won't be a major problem.  But if the Fed goes that far our financial system would be regarded as a total joke by the remainder of the globe and we would reach hyperinflation much more rapidly.

If the Federal Reserve stops buying debt completely, the financial bubbles that they have created will burst and we will rapidly be facing a financial crisis even worse than what we experienced back in 2008.

But almost whatever the Fed does at this point, the rest of the world will probably continue to start to move away from the U.S. dollar as the de facto reserve currency of the planet.  This move is just beginning, but it is going to have major implications for us in the years ahead.  This is a topic that I will be addressing extensively in future articles.

Most of the debate about quantitative easing has focused on the impact that it will have on the U.S. economy in the short-term.

That is a huge mistake.

Of much greatest importance is what quantitative easing means for the long-term.

The rest of the world is losing confidence in the U.S. dollar and in U.S. debt because of the reckless money printing that the Fed has been doing.

But we desperately need the rest of the world to use "the petrodollar" and to lend us the money that we need to pay our bills.

As the rest of the planet starts to reject the U.S. dollar and starts to demand a much higher rate of return to lend us money, the U.S. economy is going to experience a tremendous amount of pain.

It is hard to put into words how foolish the Federal Reserve has been.  The Fed is systematically destroying what was once the strongest financial system in the world, and in the end we are all going to pay the price.

Credit to Zero Hedge

Major 7.8 Magnitude Earthquake, 5.9M Aftershock Shakes Pakistan, India

A few minutes ago headlines hit that as a result of a strong earthquake, buildings shook in Delhi, India. Moments later, the USGS confirmed that a major 7.8 magnitude earthquake with an epicenter 9 miles below the Awaran/Balochistan region in Pakistan had struck, some 43 miles NNE of Awaran, and close to the India border. It is unclear yet if the two quakes were the same although it seems likely. Reuters had this preliminary report: "An strong earthquake struck remote western Pakistan on Tuesday and was felt in the Indian capital of New Delhi where buildings shook. The United States Geological Survey said that a 7.8 magnitude quake struck 145 miles southeast of Dalbandin, in Pakistan's western province of Balochistan."

Below is the current report from the USGS, we will provide more as we get it - expect much more news out of this very densely and heavily populated region.



And moments later, the USGS reported of a major 5.9 magnitude aftershock:


Credit to Zero Hedge

BIOMETRIC CLASSROOM MONITORS STUDENTS’ EYE MOVEMENTS AND CONVERSATIONS

The report reads: “Students listen up! If you are used to passing notes, tapping out texts or even sneaking in quick conversations when you’re supposed to be working on fractions…beware! Those kinds of activities could be a thing of the past – or at the very least, closely monitored – in the biometric classroom of the future.”

Sean Montgomery, co-founder and engineer for SensorStar Labs, says tracking students’ eye movements, conversations and smiles with “EngageSense” cameras will help teachers improve classroom learning. Algorithms in the program will crunch the raw visual and audio data to give teachers detailed information on students’ actions. Teachers will then be advised on how to better engage students.

“When the student is looking up at the teacher, the teacher score goes up. If she looks down at the computer, the computer score goes up. So we’re tracking facial expressions. If she makes a smile, it might be indicative that is enthusiastic about the topic,” said Montgomery.

When asked about the privacy implications of such an intrusive technology, Montgomery defended the program by claiming that the usefulness somehow outweighed any privacy concern in typical “ends justify the means” fashion.

“I think privacy is a very serious issue that we need to consider carefully going forward and in the future but the idea here is that the information is being digested and presented in a useful way so the teacher can react and respond appropriately,” said Montgomery. “I think in five years, this is going to be in classrooms.”

Despite the endless claims of technology leading to an increased “learning” experience in the classroom, studies have found just the opposite. After spending $33 million on interactive screens, laptops and high-end software, a school district in Arizona saw no improvement in test scores as the rest of the state’s scores rose.

The Bill & Melinda Gates Foundation has poured billions into the country’s public education system by supporting Common Core as well as the research of different student monitoring technologies. Gates has already begun funding the development of “engagement pedometers,” biometric bracelets for students that send electrical currents across the skin to measure the body’s response to different stimuli. Schools all across the country have already implemented biometric fingerprint and palm scanning lunch payment systems.

Earlier this year a Florida school distract ran a “student safety pilot program” that consisted of using iris scanning devices on students. A letter to parents from the biometric company’s senior director of support services stated that the program would “identify when and where a student gets on the bus, when they arrive at their school location, when and what bus the student boards and disembarks in the afternoon.”

A high school student in Texas was suspended just last year for refusing to wear an RFID-enabled ID badge that tracked her every move during school. After public outcry and protest from civil rights groups, the school offered to remove the badge’s chip and battery if the student stopped criticizing the policy. When the student decided to carry her old school ID, the school banned her from school functions.

While these systems by themselves could be useful in a perfect society, the government surveillance state has proven time and time again that such information will be used against the public. Apple, one of the companies deeply involved with the NSA, implemented fingerprint scanning technology into its newly released iPhone 5S, causing several security experts to point out the obvious privacy dangers.

Whether it be illegal face scanning cameras on city streets, surveillance street lights, the proposed biometric social security cards or drone surveillance, it is no longer a surprise that geniuses such as Stephen Hawking predict a future of “Killer robots and crippling cyber attacks.”

Credit to Story leak
Read more: http://www.storyleak.com/biometric-classroom-monitor-students-eye-movements-conversations/#ixzz2fRTbGYx8

Scientists find 'black holes' at sea.... whirlpools from which nothing can ever escape

They are impossible to see, but astronomers are convinced they exist.
Black holes are tears in the fabric of space-time that pull in everything that comes too close to them.

Nothing that gets sucked in can escape, not even light. 

Now, scientists believe they have found features of these black holes here on Earth, in the southern Atlantic Ocean.
Scroll down for video...



A black hole is a tear in the fabric of space-time that pulls in everything that comes too close to it. Nothing that gets sucked in can escape, not even light

Some of the largest ocean eddies in this region are mathematically equivalent to the mysterious black holes of space, according to researchers from ETH Zurich and the University of Miami.

This means that they do the same thing with water, that black holes do with light.

These huge ocean whirlpools are so tightly surrounded by circular water paths that nothing caught up in them escapes.

Their numbers are reportedly on the rise in the Southern Ocean, increasing the northward transport of warm and salty water.



Scientists believe they have found features of black holes in space here on Earth in ocean eddies. The reflected sunlight in this image illuminates eddies in the Gulf Stream current

WHAT ARE OCEAN EDDIES?

An ocean eddy is a swirling whirlpool surrounded by circular water paths in which nothing that is caught up in them can escape. 

Eddies can spin off from major ocean current systems and may last for several months at a time

Ocean eddies are typically bigger than a city and contain a billion tonnes of swirling water.

They take a few days to rotate, drifting slowly and carrying warm and cold water around the ocean.

Despite their importance in driving large-scale ocean circulations, eddies are not fully represented in climate models like those used by the Intergovernmental Panel on Climate Change (IPCC).

Scientists believe these ocean eddies could moderate the negative impact of melting sea ice in a warming climate.

But up until now they’ve been unable to quantify this impact because the exact boundaries of these swirling water bodies have remained a mystery.

George Haller, professor of Nonlinear Dynamics at ETH Zurich, and Francisco Beron-Vera, research Professor of Oceanography at the University of Miami, believe they have now solved this puzzle.

Using mathematical models, they isolated water-transporting eddies from a sequence of satellite observations.

They did this by detecting their rotating edges, which the scientists found were indicators of the whirlpool within.

VIDEO: This video from Nasa shows eddies forming throughout the south Atlantic

  
Amazing video shows incredible surface currents over earth


Some of the largest ocean eddies in the world are mathematically equivalent to the mysterious black holes of space, according to researchers from ETH Zurich and the University of Miami To their surprise, these eddies turned out to be mathematically equivalent to black holes. At a critical distance, a light beam no longer spirals into the black hole. Instead, it dramatically bends and comes back to its original position, forming a circular orbit. 

 A barrier surface formed by closed light orbits is called a ‘photon sphere’ in Einstein’s theory of relativity. The researchers discovered similar closed barriers around select ocean eddies. In these barriers, fluid particles move around in closed loops – similar to the path of light in a photon sphere. And as in a black hole, nothing can escape from the inside of these loops, not even water. The researchers identified seven Agulhas Rings of the black-hole type, which transported the same body of water without leaking for almost a year. ‘Mathematicians have been trying to understand such peculiarly coherent vortices in turbulent flows for a very long time’, explained Haller. 

 Their results are expected to help in resolving a number of oceanic puzzles, ranging from climate-related questions to the spread of environmental pollution patterns. 

Read more: http://www.dailymail.co.uk/sciencetech/article-2430041/Scientists-black-holes-EARTH-Oceanic-whirlpools-thought-work-way-space-phenomena.html#ixzz2fodgnQVP

Breaking: Obama's Link to Kenyan Mall Massacre Revealed

The Credit Bubble Is Not Only Back, It Is 94% Bigger Than In 2007

If the Fed was worried about 'froth' in the markets earlier in the year, then this chart should have them panicking. Of course, as Jim Bullard noted Friday, there is no bubble because everyone knows there is no bubble but judging by the massive surge in covenant-lite loan issuance, there is a bubble in forced demand for leveraged loans. At $188.7 billion, the 2013 issuance of these highly unsafe loans (which have seen huge inflows since the Fed started talking taper back in May) is almost double that of the peak of the last credit bubble in 2007 and is five times the size of 2012 YTD issuance at this time. As Reuters notes,Covenant-lite loans used to be reserved for stronger companies and credits, but are now so common in the U.S. leveraged loan market that investors are becoming wary of some credits with a full covenant package. With corporate leverage at all-time highs, what could go wrong?

Demand for leveraged-loans is surging (as rate concerns rise)...





And where there is demand, supply rises to meet it - as the least lender-protected notes surge in issuance...



(Data: Morgan Stanley S&P LCD)

Huge demand for leveraged loans from billions of dollars flowing into U.S. loan funds pushed covenant-lite loan volume to a record $188.7 billion, far surpassing the record of 2007, and still going strong.

Unrelenting investor demand for higher-yielding assets and floating-rate exposure has enabled issuers to sell these loan products that allow for future acquisitions or aggressive credit policies, but offer less protection for investors.

Investors have poured money into floating-rate loans, fearing a rise in interest rates, and private equity firms have taken advantage of the demand to get looser debt structures.

Covenant-lite loans used to be reserved for stronger companies and credits, but are now so common in the U.S. leveraged loan market that investors are becoming wary of some credits with a full covenant package.

"Transactions with covenants these days can suggest other problems with the credit, maybe that it is new to the market, or exiting from bankruptcy," said Christina Padgett, senior vice president at Moody's Investors Service.

Covenant-lite has mainly been used by private equity firms, but non-sponsored issuers seeing the robust investor demand have begun seeking these financings.

"There's a tremendous amount of demand and only so much supply. When there's more demand than supply, you can certainly do things like get covenant-lite packages through," said one portfolio manager.

Credit To Zero Hedge