Beijing.  China's shadow banking system is out of control and under mounting stress as borrowers struggle to roll over short-term debts, Fitch Ratings has warned.

The agency said the scale of credit was so extreme that the country would find it very hard to grow its way out of the excesses as in past episodes, implying tougher times ahead.

In an interview with Charlene Chu, Fitch's senior director in Beijing, she explained to me:

"The credit-driven growth model is clearly falling apart. This could feed into a massive over-capacity problem, and potentially into a Japanese-style deflation. There is no transparency in the shadow banking system, and systemic risk is rising. We have no idea who the borrowers are, who the lenders are, and what the quality of assets is, and this undermines signaling." 

"There is no way they can grow out of their asset problems as they did in the past," she continued. "We think this will be very different from the banking crisis in the late 1990s. With credit at 200% of GDP, the numerator is growing twice as fast as the denominator. You can't grow out of that." 

We may be seeing the arrival of a "Minsky Moment" for China, when the debt pyramid collapses under its own weight.

Red Rocks Amphitheatre, October 23, 2012.  Remember the place and date, for history may record them as where and when America's spiritual rebirth began.  What happened here is simply astounding. There is an eyewitness account of it that made me cry.  I'd like to ask you to take a moment to read Mitt Romney's Quiet Prayer Amidst the Sound of Thunder...

...From the sublime to the absurdly disgusting.  Zero's latest official campaign ad, released yesterday (10/25), is a TV Bimbo comparing a girl's losing her virginity to voting for Zero.  Brietbart's Ben Shapiro has the video + transcript and appropriate comment.  Zero is sinking into the depths of desperation.  You wonder how much further he'll sink over the next 11 days....

...So as he sinks and it looks better for Romney-Ryan by the day, let's move to where a number of TTPers want to go:  the Senate. 

Assume you are a skilled heart surgeon and your patient needs a new heart valve, but you were given a spoon rather than a scalpel to cut open a chest. Relying on the Federal Reserve and the European Central Bank (ECB) to cure the lack of job growth is going to be no more effective than giving a heart surgeon a spoon.

Central banks, such as the Fed and ECB, can cause major economic problems by printing too much or too little money. They do not cause fiscal problems - too much taxing and spending - nor can they cure them. Last week, Fed Chairman Ben S. Bernanke came close to acknowledging what many already know - that the Fed can do little at this point:

"To the fullest extent possible, federal tax and spending policies should increase incentives to work and save, encourage investments in workforce skills, stimulate private capital formation, promote research and development, and provide necessary public infrastructure," he said. ECB Chairman Mario Draghi has basically said the same thing to the political leaders of the eurozone countries.

The political class, to cover its own irresponsibility, is trying to dump the economic crisis on the central banks.

Everyone in America is holding his or her breath, sure that an Islamofascist terrorist attack will be perpetrated before the November election. Al Qaeda wants to pull off another Spain, it is thought. Blowing up the Madrid trains just before the Spanish election defeated the anti-terrorist Aznar government and put spineless Bambi Zapatero, in office.

Al Qaeda’s greatest goal right now is to prevent the re-election of George Bush. That is why the safest place in the US this month will be Boston. There is no way anything will be perpetrated to attack the Democrat Convention. New York during the Republican Convention is another matter.

But this is what is expected. Here is what worries me.

Sorry folks, but tonight's entertainment feature on the Second American Revolution, replacing the Obama Regime with the Declaration of Independence and the Constitution, has been retracted.  You will now enjoy a rerun of the French Revolution instead.

What?  How can this be?  Here's the sad story that will explain why you need to learn French and to buy our New high tech neck armor -- specially priced at only $500 to save your neck from the French guillotine.  Also excellent protection against vampires.  But most of all, this is a surprise revisit from the past to warn us why we must prepare ourselves for the coming French Revolution in America.

You will recognize many of the Ministries issuing endless rules and regulations that you have nothing to say about but sadly there will be more, though there will be no Ministry of Silly Walks, because there is nothing funny about it.  Sit back, raise your glass of French wine, pick up your guitar and play, just like yesterday, you'll get on your knees and pray,  We Won't Get Fooled Again!!

(Yes, the classic by The Who is rated by National Review as the #1 Conservative Rock Song of all time.  The lyrics are here, you can listen/watch here.)

Written in 1971, it looks eerily prescient, because Obama's America today looks more like it's on the way to another French Revolution than another American one.  To learn why, we turn to a Frenchman who explained it over 150 years ago.

"It's over."  When hyper-partisan Democrat operative Bob Beckel throws in the towel, as he did last night on Fox, you know it really may be for Zero.  In fact, you might mark down on your calendar that last night, October 18, is when the Zero Presidency died, as it suffered what looks to be an unrecoverable triple whammy.

First was Beckel's verdict in response to the latest Gallup poll (10/17) showing Romney with a virtually insurmountable lead of 52%-45% over Zero.

Second was the greatest gaffe Zero has ever uttered, timed less than three weeks before the election.  Last night on Jon Stewart's Comedy Central show (yes, a comedy show), he actually said, in response to Stewart's questioning his handling of the Benghazi scandal: "If four Americans get killed, it's not optimal."  Tim Stanley of the London Telegraph thinks he's channeling Michael Dukakis.

Third was Romney's hilarious gutting of Zero at the Al Smith Dinner last night, the ultimate elite white-tie event for Catholic charities held annually at the Waldorf-Astoria.  Example: now as Mr. Obama is in "the last few months of his presidency," he must be thinking:  "So little time, so much to redistribute."

Or how about this: "Campaigns are hard, and I and the President are each very lucky to have one person who's always in our corner, someone who we can lean on, someone who's a comforting presence without whom we wouldn't be able to go another day. I have my beautiful wife, Ann. He has Bill Clinton."  Enjoy the whole monologue, and note how it was a huge hit with the New York audience:

What government unit has the right to tax you -- your local government, regional or state government, federal government, or multinational organizations such as the United Nations, the World Bank and the World Health Organization?

The reason the question is becoming more important is that rising numbers of politically powerful persons and institutions are calling for global taxes on such things as financial transactions, tobacco, sugar and carbon emissions.

Think of the consequences if international organizations gain the ability to tax. The tax-exempt bureaucrats who run these organizations will have an endless list of "unmet needs" and thus will create reasons to have never-ending tax increases. The United Nations is pushing a global financial transactions tax "to offset the costs of the enduring economic, financial, fuel, climate and food crises, and to protect basic human rights."

Endless global taxation to finance endless global corruption and fascism.

The most disastrous news to come out of Iraq this week was the demand by the new Iraqi Interim Government for custody of Saddam Hussein. We are reaping the moldy harvest of the American liberal obsession for legalism. All one had to do is see the farce of Slobodan Milosevic’s trial to know what judicial lunacy awaits a similar tribunal travesty for Saddam.

Yet this is suddenly the least of our worries. Turning Saddam over to the Iraqis means he will escape from custody. Through bribery or blackmail or force, the Iraqis will either let him escape or be unable to prevent it - which means all the treasure and blood America has spilled to liberate Iraq will have been in vain.

The strategic challenge that Russia poses to the United States today is quite serious. Russia is increasingly anti-democratic and hostile to the United States.  Xenophobia is widespread in Russia.  The Kremlin is currently encouraging nationalism and militarizing the country.  It constantly attacks the West.  And a sizable number of the Russian population sees neighboring countries as part of the Russian zone of influence.

Now this is not me speaking, this is taken from a recent statement by Alexei Kudrin, who until September of 2011 was the finance minister of Russia, and who has just been publicly offered a cabinet position by Vladimir Putin. 

The most serious aspect of the Russian threat to the United States is their nuclear use doctrine.  They have the lowest nuclear use threshold in the world.  Russia reserves the right to introduce nuclear weapons into conventional warfare, and they characterize this, amazingly, as "de-escalation" of the conflict.

You won't believe the statements of Russia's nuclear commanders.  Here's one: