Greater Recession Coming??

[slug zitski]

The thing about the doomsayers is that they’re usually correct. At any given moment, I could site a dozen statistics that show ‘this is all bullshit, and can’t possibly work’. Math and all that.

The thing about money is that it’s a modern religion – it is fundamentally faith based. The system continues to work as long as the majority of participants believe it works. And the participants – from Jeff Bezos on down to Jeff Nobody - are substantially motivated by self-interest to continue to believe.

That’s where money crosses into things like geo-politics and one of the big reasons why the US military is so closely tied to the petro-dollar and the US hegemony. You cannot have a ‘global reserve currency’ without a ‘globally dominant’ military and a 'globially dominant financial system'. The three tools of governance – popularity, force, and money.

Just to put things in perspective, the global ‘bitcoin’ market is between 1-2 trillion dollars equivalent. The global ‘gold’ market, is about 10 trillion dollars total (5x bigger). The global ‘equities’ market – stocks – is around 51 trillion dollars (5x bigger again). The ‘shadow banking system’ is estimated at roughly the size of the equities market - $50 billion. The ‘official’ global debt market is about $290 trillion dollars – 6x more than the equities market. Hence, when I die, I want to come back as something powerful.. like the bond market.

There’s about 300 trillion reasons to NOT believe the doomsayers - regardless of if they’re speaking the absolute scientific truth with perfect mathematical certainty. Money is either force or faith. And we’ve collectively decided that the ‘force’ version is right out so we’re left with the Church of the Mighty Dollar and the high priest is Jerome Powell. But just like Boehner said, "A leader without followers is a man on a walk" - so Powell has to try and serve his many masters. That's why the fed fund rate tends to follow the 2-year treasury but is in competion with the 10 year. Its the balance of power between the short term and the long term that he's trying to placate.

The dollars dominance and Americas control of the financial system is over

the dollar is no longer a safe asset

this will have serious financial consequences for any debtor

Analysis: As sanctions 'weaponize' U.S. dollar, some Treasury buyers could fall back

U.S. sanctions against Russia should hasten a move by some countries to reduce their reliance on the U.S. dollar, which could also soften demand for Treasuries just as the Federal Reserve, the largest holder of U.S. debt, looks to cut its bond holdings.

www.reuters.com

 

[Not for nothing]

The dollars dominance and Americas control of the financial system is over

the dollar is no longer a safe asset

this will have serious financial consequences for any debtor

Analysis: As sanctions 'weaponize' U.S. dollar, some Treasury buyers could fall back

U.S. sanctions against Russia should hasten a move by some countries to reduce their reliance on the U.S. dollar, which could also soften demand for Treasuries just as the Federal Reserve, the largest holder of U.S. debt, looks to cut its bond holdings.

www.reuters.com

How can that be it has "In God we trust" on them

 

[billy backstay]

The dollars dominance and Americas control of the financial system is over

the dollar is no longer a safe asset

this will have serious financial consequences for any debtor

Analysis: As sanctions 'weaponize' U.S. dollar, some Treasury buyers could fall back

U.S. sanctions against Russia should hasten a move by some countries to reduce their reliance on the U.S. dollar, which could also soften demand for Treasuries just as the Federal Reserve, the largest holder of U.S. debt, looks to cut its bond holdings.

www.reuters.com

The article says that other countries "could" reduce their purchases of US Treasuries, but nowhere in the article does it state an alternative where they might park their money, and at the very bottom of the story it says:

"That said, even if these countries continue to reduce their purchases of Treasuries, they are not expected to launch large sales of the bonds. There also may be limits to how far countries can reduce their holdings because there are few alternatives in terms of safety and liquidity."

Sounds like a lot of "opinion" without much fact to back that opinion up! Alll hat no cattle!

 

[SloopJonB]

Billy, Billy, Billy - are you seriously considering something Sluggo said about anything other than sailboats?

He's a proven simpleton when it comes to anything remotely socioeconomic.

 

[El Borracho]

The dollars dominance and Americas control of the financial system is over

the dollar is no longer a safe asset

this will have serious financial consequences for any debtor

Analysis: As sanctions 'weaponize' U.S. dollar, some Treasury buyers could fall back

U.S. sanctions against Russia should hasten a move by some countries to reduce their reliance on the U.S. dollar, which could also soften demand for Treasuries just as the Federal Reserve, the largest holder of U.S. debt, looks to cut its bond holdings.

www.reuters.com

Heh. The US Dollar giving up reserve currency status to what? BRICS? Laughable. Not going to happen without some huge unexpected event. Like a meteor into NYC. Dollar strength is at an all time high. I’d switch to the Philippine Peso before anything BRICS.

 

[Raz'r]

Will there be a “bigger” recession?

Yes, eventually. Maybe now, maybe not. That’s why the market predicts recessions 2-3 times as often as they happen. Yield curves too.

 

[BeSafe]

Yea, I think the demise of the dollar is grossly overstated. Partly because it's not just the 'US dollar' but the financial system that goes along with it including the Euro.

I think there is going to be a major 'problem' at some point in the next few years. There's just so many black swans now its more like a herd of zebras.

There is a math problem for example - the Federal Reserve Balance sheet - all 8 trillion+ of it - is a mix of long and short term bonds that returns somewhere around 2-3%. That's their profit. The fed pays reserves out at at 4% - that's their debt. And it happens to be more than what they make in profit. For the first time....ever?... the Federal Reserve is going to be broke. They give all their excess money to the Treasury which has been using that money to offset the deficit. There won't be an excess anymore - in fact, there will be a negative that will have to be filled by getting money FROM the Treasury.

To fund the government, the deficit is also going to be higher. So if you need a trillion dollars, you're not going to be able to sell a trillion in bonds at 2%. Its going to be 4%. So the deficit is going to increase even if the government spending stayed flat. All this SHOULD be driving down the value of the dollar - but it's not. That's because the rest of the developed world is in the shitter even worse.

There's LOTS of those examples. That's why so many of the doomsayers have so much material. But where does that lead?

The scuttlebut is that the 'great reset' is going to be tied to the first fiscal crisis after the CBDC rollout is complete. What's going to happen is that the CBDC becomes the new currency. That process will proceed at normal governemental pace until the next 'Lehman Moment' at which point the CBDC becomes 'real' money and all debt valued in the old currency gets debased (namely bonds). The government will then throttle the conversion. The great Jubilee.

I do think that the digital money is going to be a tool of control. That's too easy. But I'm not sure i buy that it is also a tool for debt elimination.

 

[billy backstay]

Thanks! Had to look up CBDC though...

What Is a Central Bank Digital Currency (CBDC)?

Central Bank Digital Currency (CBDC) is the digital form of a country's fiat currency, which is regulated by its central bank.

www.investopedia.com

 

[billy backstay]

Billy, Billy, Billy - are you seriously considering something Sluggo said about anything other than sailboats?

He's a proven simpleton when it comes to anything remotely socioeconomic.

Not everyone reading his post knows that, and I thought it deserved being properly disputed, nothing more nor less....

 

[Peter Andersen]

Hard to have a recession when people keep buying shit...

Black Friday's hottest items sell after record Thanksgiving Day spending

Shoppers spent a record $5.29B this Thanksgiving, according to Adobe Analytics -- a figure up 2.9% year-over-year. Adobe Analytics’s report on record spending may be surprising to some, as the economy is at an inflation level not seen in the last 40 years, and ongoing fears of a recession. Big...

www.yahoo.com

Credit card debt it is raging to record levels

 

[Swimsailor]

Credit card debt it is raging to record levels

A point I already made.

 

[Not for nothing]

Credit card debt it is raging to record levels

The whole economic system is based on debt, The treasury keeps printing $$ everyday which is more debt, Credit cards is the tip of the iceberg, Houses, Cars, cost of education, food is all based on DEBT
It all started in late November 1913, on a private island off the coast of Georgia, ... would form the backbone of what would later be called the Federal Reserve Act.
A good video to watch by the Rich dad/ poor dad author

 

[SloopJonB]

JFC - every fucking time there is a cyclical economic downturn the usual suspects start their bullshit about how it's the end of society as we have known it.

Actually, it's the end of civilization.

Read some fucking history.

 

[Raz'r]

You say “debt” like it’s a bad thing. Look up the economic woes under asset-based money. Think inflation sucks now? Imagine the price swings of consumables if bitcoin was our currency. Remember, debt for one party is an asset for the other party.

And it’s not possible for the Fed to run out of cash. They can literally create it.

 

[Peter Andersen]

A point I already made.

Don't worry. Uncle Joey will pay it off for you

 

[dacapo]

JFC - every fucking time there is a cyclical economic downturn the usual suspects start their bullshit about how it's the end of society as we have known it.

Actually, it's the end of civilization.

Read some fucking history.

Actually, it's the "End of the World As We Know It" if you ask Michael Stipe

 

[jzk]

JFC - every fucking time there is a cyclical economic downturn the usual suspects start their bullshit about how it's the end of society as we have known it.

Actually, it's the end of civilization.

Read some fucking history.

Yeah we just need government to stop making things a whole lot worse. And besides, fuck the little guy, you got yours, right?

 

[Voyageur]

Don't worry. Uncle Joey will pay it off for you

who has done a better job with the economy in the last 50 years in the USA, republicans or democrats? other than tax breaks for the people who don't need tax breaks, what have republican policies done to grow the economy or pay down the debt.

 

[slug zitski]

Heh. The US Dollar giving up reserve currency status to what? BRICS? Laughable. Not going to happen without some huge unexpected event. Like a meteor into NYC. Dollar strength is at an all time high. I’d switch to the Philippine Peso before anything BRICS.

It’s happening right now

Analysis: As sanctions 'weaponize' U.S. dollar, some Treasury buyers could fall back

U.S. sanctions against Russia should hasten a move by some countries to reduce their reliance on the U.S. dollar, which could also soften demand for Treasuries just as the Federal Reserve, the largest holder of U.S. debt, looks to cut its bond holdings.

www.reuters.com

 

[billy backstay]

The whole economic system is based on debt, The treasury keeps printing $$ everyday which is more debt, Credit cards is the tip of the iceberg, Houses, Cars, cost of education, food is all based on DEBT
It all started in late November 1913, on a private island off the coast of Georgia, ... would form the backbone of what would later be called the Federal Reserve Act.
A good video to watch by the Rich dad/ poor dad author

I have a lot of respect for Koyasaki; his "Rich Dad Poor Dad" books helped me a lot with successful investing. Even though Media Bias/Fact Check highly rates this source, it reads more like an advert for his or other investment coachs books or products. And I think it unlikely the following regarding SSI and Medicare/healthcare will occur, but the recurrence of a 2007-08 event is always possible with the reckless behaviour of our so-called "expert" Government bankers!!

"During a recent video interaction, Kiyosaki says rising inflation, shortfalls in social security, and healthcare funding are the key factors influencing the economy. This is going to hammer a massive number of baby boomers.

Benzinga​

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