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Posted on 01/30/2025 9:33:44 AM PST by delta7
Total global debt has peaked to 326% of global GDP, adding an additional $12 trillion of debt in the last three quarters of 2024, according to the Institute of International Finance. This figure surpasses what we saw amid the pandemic and is expected to continually rise and governments continue to borrow with no intention of repayment.
The Big Bang of the sovereign debt crisis began in 2015.75, as indicated by the computers, around the introduction of negative rates and Quantitative Easing, which shifted the risk from the free market to the central banks. The 2015.75 date was also 26 years from the first break in Marxism in 1989. The bottom of the ECM from 2015.75 to 2020.05 was also 31.4 years from the start of the fall of communism that culminated in the final stages of the collapse of socialism. I repeatedly warned that our models indicated the central banks would become trapped by these policies and now we have a completely unsustainable situation.
If interest rates rise, their portfolios crash in value (price). Such an outcome would raise the question of will the private sector return to the government bond markets when they see there is a rising risk factor? Our model showed that this would not be the case. In other words, the Sovereign Debt Crisis has taken place and to prevent the PRICE crash, the central banks became the buyer to hold interest rates down and bond prices up. We have seen governments and institutions offload bonds and government debt since the Big Bang.
Emerging Market Debt
Emerging markets have reached 245% of GDP in debt, totaling $105 trillion. Poor nations are now spending more on their debt than infrastructure, health care, or education. These nations cannot afford to simply not repay and multilateral development banks have turned into lenders of last resort.
ALL government debt is in serious trouble because they just never fund a damn thing. The solution is to always borrow and there is no plan to ever pay anything back. The behind the curtain reasoning is they are burning money for fuel because they are always reducing the value of prior debt that is never indexed to inflation.
We have seen larger economies begin the snowball effect of borrowing after World War II and the repercussions are now arising. Now we have a serious crisis that has shifted from the free trading bond markets exclusively to the central banks. This is part of the crisis unfolding in the repo market. There does not appear to be any recovery on the horizon. Politicians are undermining the confidence in government, to begin with, and that will influence bond buyers.
The astounding debt crisis has fanned the flames of war as initiating a global conflict is a way, politicians believe, to continue delaying debt payments. The majority of nations are simply too far gone in debt to ever properly repay. Who would buy if there is no guaranteed return?
Total global government debt is now $98,000,000,000,000 ($98 trillion) and is forecast to reach $130 trillion by 2028, which is also when the computer has predicted that the world will feel the aftershocks of a global recession.
“I have messages thanking me for Armstrong’s work, “
So, you now admit YOU ARE ARMSTRONG!
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Notably, as Argentina's Milei and others have demonstrated, major cuts in government spending can restore real economic growth and make it possible to reduce debt loads even in chronic basket case economies. Trump and DOGE are now undertaking a similar effort on behalf of the US, albeit in much less dire circumstances.
In a projected global debt reckoning, the United States has a privileged position due to our political stability, immense productive capacity, technological skill, cultural appeal, and global military power. These underpin the dollar's role as the primary global trade and reserve currency. Indeed, much of the dollar creation and borrowing that the US has engaged in over the last fifty years was spurred by the global demand for dollars and associated US government debt instruments.
The bottom line: the global debt bomb is likely to be gradually defused, country by country, year by year. As that happens, a general crisis will be avoided and the demand for dollars and US government debt will continue to benefit the US. That will provide the opportunity to put our own finances in better order.
As for central bank gold buying, it is more a hedge than a sign of impending doom. Living in Florida and having experienced many hurricanes, you lay in supplies and prepare for the worst but, in the event, most hurricanes are not very bad. So also with warnings of general economic crisis. Most such crises never quite materialize even though people, countries, and central banks take precautions.
Armstrong has predicted 15 of the last 2 crises.
“I have messages thanking me for Armstrong’s work, “ So, you now admit YOU ARE ARMSTRONG!I like that! It's a classic!
The movie The Big Short about the 2007 to 2008 financial crisis provides an entertaining and essentially accurate account of how a group of hedge fund contrarians made a killing. As it happens, the now wealthy operators profiled in that movie recently shut down their short seller hedge fund. Why? They have gone long because they see the US and global economies as strong enough to make even them bullish.
Knowing what is takes some effort.
Knowing what will be is frequently just a guess.
Humans have become quite adept at muddling through.
LOL ... you got the stalker/alter ego troll”s” to post to himselves (😂), again!!
Good work.
The dolt doesn’t even realize you can receive messages, here, via PM.
Double bust! 😂
In real time, or with a delay?
Armstrong tracks ALL the world’s capital movementsTwo things to note:
In real time, or with a delay?
Not our problem.
Let ‘em starve.
The spending won’t stop.
The debt cannot be paid, nor traded.
This cannot end well, and people who think that Armstrong is just wrong aren’t thinking past that short-sighted little quip.
It doesn’t matter if Armstrong is right or wrong, because the spending won’t stop, and the debt cannot be paid, nor traded.
It’s a matter of simple mathematics.
Why can't debt be paid or traded?
There are no resources in adequate supply to pay for it. Trading it has the same problem.
Even if you went around the world trading debt until every nation owned their own debt...those nations...just about all of them...have no way to cover it.
Debt must be paid for with wealth. That means there must be resources to cover that debt. Trying to pay for it with fiat “money”, just causes hyperinflation in any...and probably every...economy.
Starting to seem 1930s stuff coming back around.
How then did Argentina elect Milei and pull back from the brink? Eventually, unproductive and unnecessary spending stops when it can no longer be sustained. For the US, I hope and expect that will come sooner.
If you want TXGator and Moneyback to see your post, you need to add them in the TO: field at the top of the posting page.
Simply put a semicolon and then the username, repeat as needed. It even states that right after the word TO:
It is also considered proper practice to add usernames to the TO: field if you mention their username in your post.
You should know these things by now, but now you cannot claim you don’t.
So, you’re welcome.
P.S. There is no user named TXGATOR. If you are trying to get a user’s attention, you should at least get their screenname correct.
Thank you.
Yet you constantly bring them up in your posts. Are they living in your head ?
I can buy and sell US Treasury debt.
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