The Garbageman: Fed Rate Hikes Will Intensify Global Debt Crisis (NOW They Realize That Low-Rate Debt Is A Problem If Rates Rise??)

Confounded Interest ^ | 01/26/2022 | Anthony B. Sanders

[Browns Ultra Fan]

CNBC had an interesting Homer Simpson-moment when the Jubilee Debt Campaign suddenly realized that there was enormous debt outstanding, fueled by Central Banks and governments. They are only now realizing that Central Bank zero-interest rate policies leading to massive debt issuance may be a problem??

Interest rate hikes from the U.S. Federal Reserve and other central banks are likely to worsen a global debt crisis, particularly for developing countries, according to a new report from U.K. non-profit the Jubilee Debt Campaign.

In a report published Sunday, the Jubilee Debt Campaign highlighted that developing countries’ debt payments rose 120% between 2010 and 2021, and are currently at their highest since 2001. The average portion of government revenues channeled toward external debt payments increased from 6.8% in 2010 to 14.3% in 2021, with payments shooting up in 2020.

The sharp increase in debt payments is hindering countries’ economic recovery from the pandemic, the report suggested, and rising U.S. and global interest rates in 2022 could exacerbate the problem for many lower income countries.

Chow called on G-20 leaders to stop “burying their heads in the sand” and argued that the global economy urgently needs a “comprehensive debt cancellation scheme which compels private lenders to take part in debt relief.”

Austin, Texas musician Cornell Hurd has a song that nicely summarizes Central Banks like the US Federal Reserve: The Garbageman.

You ask me what I do for a living,

You’re trying to get a feeling on how I’m fixed for cash.

My friends all say I’m a just garbageman, baby

I’m out in this honkeytonk market, picking up trash.

Today we may see The Federal Reserve raise their target rate (slightly) to measure how bad markets will receive the news.

The Garbageman, Jay Powell.

[Browns Ultra Fan]

Let's see if The Fed ACTUALLY tightens. They may try a little. If the reaction is too intense, they will back off.

[PeterPrinciple]

the global economy urgently needs a “comprehensive debt cancellation scheme which compels private lenders to take part in debt relief.”

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They just haven’t quite decided who it will be, but that is the plan.

They think govt doesn’t have to participate................

[Worldtraveler once upon a time]

All those very-smart, stupid people. The gravy train is running out of fuel, and printing more is not an option. So they will recommend it.

[PeterPrinciple]

I have worked with bankruptcy. IT is business as usual, right up to the day the cash flow stops.

Any ideas on how the cash flow stops?

[SaxxonWoods]

Scream for years that the FED has rates too low (causing the dreaded inflation) and then scream when they mention raising them slightly.

Make up your mind.