Hi, WT ... I agree, Cantarell and Gwahar are the ones to watch ... however, the next leg of deleveraging will commence shortly; I suspect this will center on state and local governments going belly up en masse. Sprawl is expensive and the states are going to find out the hard way the price tag on all that 'growth'. For the past few decades credit- inflated property values and state income tax receipts (on inflation) have generated the illusion of limitless real estate- derived prosperity. Exponential demand for government services has been part of that growth regime.

The illusion is now shattered. In stead of productive assets, the growth represents limitless liabilites!

A large part of state/local government expenditures is payroll. Employment will simply get crushed. Demand has a very long way to fall.

This next leg will require an additional $2 - 3 trillion bailout on top of the $8.5 trillion already on the table. This amount will keep schools open and some police on duty. At the same time it will be the end of the bond market as we know it. It will dawn on both American citizens the the chimps in government and business that this situaion is a) dire, b) not going to end by itself and allow the government and business to take credit, and c) light years/parsecs beyong the abilities of Manfred J. Obama & Co.

Obama does look good in a suit ...

As we all know, in a deflationary environment, products, services and assets ALL decline in price relative to currency or in this case, credit; the decline triggers unemployment as a consequence. In this environment, the unemployed have benefits but these are trifling and soon run out. To the penniless, nickel gas is out of reach.

My only hope is we get some good rock and roll out of all this crap. If we trade national bankruptcy and the impoverishment of millions for the end of rap, disco and 'smooth jazz' it will be a good trade! The other 'cachet' item I'm waiting for is the news that Ben Bernanke has thrown himself out a high window ... that I might live so long ...