Posted on 07/01/2016 1:42:13 PM PDT by blam
Rachael Levy
July 1, 2016
"We are facing the largest macro imbalance in global history."
That's according to Kyle Bass, founder of hedge fund Hayman Capital Management.
Investors better prepare for a Chinese crisis that will mimic what happened in the US mortgage crisis, Bass said in a Friday interview with Real Vision Television.
"When I look at what's happening now in China, the amplitude of what's happening is two, three, or four times what happened in the US," he said.
Here are Bass' main points:
•The Chinese are going to have to accept a devaluation of the yuan.
• When the Chinese crisis hits, the Chinese are going to have to react similarly to the way central bankers did after the mortgage crisis.
• "They're going to expand the PBOC's [People's Bank of China] balance sheet. They're going to slash the reserve requirement. They're going to drop the deposit rate to zero. They're going to do everything the US did in our crisis," he said.
• And it won't look good. "Every single thing the Chinese central bank has to do is currency negative for them."
• The takeaway? You better get ready. "In the next two years, this is happening. If you want to pretend that it's not going to happen, you're going to do poorly somewhere in your portfolio."
(snip)
(Excerpt) Read more at businessinsider.com ...
I think the fundamental problem is that everyone is producing too much stuff. And most of it is good quality. So we are all trying to sell to each other with diminishing returns. At the same time, companies are getting more efficient through robotics, software and automation. The idea is that the companies will need fewer workers and will therefore be more profitable. However, this approach also results in fewer consumers....or at least fewer paying consumers.
So ever more people become clients of the State.
Gooooooooooooooooooooooooooold.
I need to switch eyeglasses. I thought the headlines were referring to ‘The Largest MARCO Imbalance in Global History”,
Meaning Marco Rubio. Apples & Oranges, right?
I wondered what happened to this guy after ‘N Sync broke up.
To answer your question on how to get ready: My guess is to keep a large portion of your portfolio invested in very liquid assets. Focus on securites from industries operated from within the united states, if not from your region of the country. Keep a little gold too, in any form.
This imbalance is going to lead to some sort of tipping point where copies or Excel will leak out the bottom of your computer or PowerPoint will fly out of the top.
Get ready or you could be cut by the digital shrapnel.
Gee, isn't that wonderful!?!?!?!?
How is that bad for anyone?
He was on Family Feud sparring wits with Kelly Pickler recently.
I’ll take a crack
sell your ¥ yuan.....now
convert the proceeds to gold
Photons shatter?
It won’t matter because you will have $0 in your bank account.
Boy howdy.
I've read that 40% of Americans making $40,000 - $100,000 a year can not come up with $400.00 cash for an emergency.
The numbers are a little different in the below article:
47 Percent Of Americans Cannot Even Come Up With $400 To Cover An Emergency Room Visit
" In fact, 51 percent of all American workers make less than $30,000 a year according to the Social Security Administration.
•The Chinese are going to have to accept a devaluation of the yuan.
• When the Chinese crisis hits, the Chinese are going to have to react similarly to the way central bankers did after the mortgage crisis.
• “They're going to expand the PBOC’s [People's Bank of China] balance sheet. They're going to slash the reserve requirement. They're going to drop the deposit rate to zero. They're going to do everything the US did in our crisis,” he said.
• And it won't look good. “Every single thing the Chinese central bank has to do is currency negative for them.”
• The takeaway? You better get ready. “In the next two years, this is happening. If you want to pretend that it's not going to happen, you're going to do poorly somewhere in your portfolio.”
One other thing that bears notice and Mr Bass left out.
The Chinese are are the primary US bond buyers who buy the bonds that are supporting that unprecedented and unsustainable deficit spending that is propping up the Obama Economy.
The reason the Chinese keep buying our debt is to keep their exchange rate a rock bottom so they can flood the American market with cheap, under valued goods. It's like the old trade war dumping schemes only it's monetary based and across the board rather than in a isolated market segment like steel or oil production.
As soon as the exchange rate imbalance (another unsustainable ) collapses, the Chinese will cat way back on US government bond purchases and the liquidity that is fueling the borrowing for our out of control social welfare spending will dry up over night.
What is going to happen when our Federal Government can no longer borrow the money to fill the EBT cards of the tens of million of unemployed, “disabled” and welfare cases added to the entitlement rolls by President Obama?
I think Alan Greenspan who, love him or hate him, was aways a financial guy ahead of the curve. He has recently made some very disturbing predictions regarding collapse of the US economy due to the inability to fund out of control entitlement spending leading to martial law.
Just sayin'
“...the Chinese will cat way back on US government bond purchases...”
Actually, I think the Chinese will suddenly dump US bonds, use the devalued yuan generated to reduce internal debt, and then sit back and watch as their piles of precious and strategic metals blossom.
Don't think that Obama and the domestic enemies in his administration aren't aware of and supporting this, moreso if Trump gets into office. They hate us more than they hate any other country.
Don't think that Obama and the domestic enemies in his administration aren't aware of and supporting this, moreso if Trump gets into office. They hate us more than they hate any other country.
I think that that's been the Obama Admin Cloward - Piven plan all along.
The significance is that this is the first warning from the Washington Establishment Elite, of which Greenspan is a bell weather member, of what we are facing .
The globalists do not want us to have any means to get ready. The fix is in for themselves alone.
.......my little portfolio is but a microscopic pin prick compared to hedge funds and assorted other very wealthy folks. That said, I’ve been reading these kind of articles and decided to drop a contract to develop another shopping center. Instead, I’m buying a service business that is about as depression proof as any business can get. We would all have to be DEAD for this business to not have business.
So, this is one thing that this one person is doing because I believe China’s collapse is rather similar to the planes flying into the WTC. It took a while but they both collapsed into a pile of rubble. In a worst case scenario, we will all be starting over with nothing. Lol, I know how to handle that!
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