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In current usage, any disastrous situation. The balls referred to are NOT testicles. The term dates from the days of wooden sailing ships when the [existence] of a shipboard disaster, such as plague, lack of food or water, mutiny, etc. was communicated to the [outside world] by hoisting large-ish, brightly painted wooden balls up into the rigging. Balls of different colors represented different disasters and therefore served as either requests for [assistance] or warnings to stay clear.
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