Posted on 05/09/2022 7:30:53 AM PDT by delta7
Posted May 9th, 2022 at 6:01 AM (CST) by Bill Holter & filed under Bill Holter.
Over the years, many have continually asked “when”? When will the system break down? Well, I have some good news and some bad news for you. The good news is; you are watching the collapse in real time with your own eyes. The bad news? You are watching the collapse in real time with your own eyes! This will be short and sweet.
1. Inflation is raging as the continual money printing, expansions of debt, and deficit spending have finally overwhelmed the financial engineering used to hide their dirty work. Simply, our money was debased as the party raged on.
2. As a result (response) of the monetary insanity, market interest rates began to rise over a year ago. As usual, central banks are way behind the curve and are now being forced to tighten.
3. While inflation of commodities and everyday goods kicks into full gear, asset inflation is giving way to asset deflation.
4. Asset bubbles are bursting all over the world with THE most important rupture being the credit markets. Over the last year alone, interest rates on average are up well over five fold. The “foundation”, credit, has cracked and crashed before your very eyes. Few truly understand this.
5. Stock markets are now down significantly from their highs and the average stock has already entered bear markets. Those viewing their 401K statements for April will be very disheartened.
6. Real estate, which had been so hot over the last couple years has turned moribund. Buyers have been priced out, followed by being shut out due to mortgage rates more than doubling. Affordability does not exist. The psychology is about to change as owners will soon understand their asset is becoming a liability.
7. A topic all on its own, the rule of law has broken down but a subject for another day.
So where does this leave us? We had the “good fortune” of living in a virtuous cycle to the upside, unfortunately we will now have to live in a virtuous and self reinforcing down cycle as asset values circle the drain. Without great explanation, as rates rise, asset values decline, it is simple math. And here is the problem; think back in time only a couple years ago and you’ll remember how people were spending freely because they felt “rich” (and maybe got some of the stimmy monies?). Now it is the reverse. Homeowners are sitting on properties much longer and buyers no longer (have the ability) bid above asking price. In fact, discounted bids are already becoming the norm. The average stock portfolio is down well over 20% since the start of the year. Bluntly, people are beginning to feel “poor” and they will react by reducing spending. All of the above of course is topped off by the cost of living increases we already know of…
Again, none of this is rocket science and should not be new to anyone reading this. The bottom line is this; the wheels are falling off the global debt cart in a world where nothing functions without the use of credit. Shortages of all sorts are already happening even if you have the cash for purchase. The greatest fear for central bankers, debt deflation has finally arrived!
Lastly, please understand and never forget, “markets” have been ruled by financial engineering for three decades. Derivatives (probably $2 Quadrillion now?) of all sorts will begin to blow up. Whether it be because of the underlying interest assumptions, over concentration of paper versus deliverable goods (force majeure), or just plain old outright insolvencies …you will witness the exact reverse (in albeit a MUCH shortened timeframe) than the buildup.
As we warned you for years, “inflation of the things you need, and deflation of the things you have”! I know, it’s a bad cocktail but exactly what we are faced with … your best position is to be where you cannot be bankrupted while the world around you bankrupts!
Standing watch,
Bill Holter
Holter-Sinclair collaboration
Weaponizing the USD destroyed world trade, global credit markets, supply side inflation, dethroning of the USD, bond markets collapsing, global energy and food crisis, etc….AND the damage can not be undone.
I say that our “production problems” and “supply chain problems” are almost entirely self-imposed. And on top of that, the world has bought into a global economic system which is built on debt and which (I believe) is secondary to an enormous dark money economy that really runs the show.
I think we need to really think differently about all aspects of economics. And part of that is a flat out elimination of debt. Full Jubilee. Also, government seizure of US assets owned by foreign powers. The only people who will really be screwed are Central Bankers/Globalists and China.
The Left uses crises to further their goals. We could do that too and live in a very different world.
These “Masters of the Universe” simply cannot fool human nature forever.
PING!
Yup,
Oh wait...that's because The End is like Godot. These guys are the Harold Camping of economic fearporn. They've been hacking away since the mid-2000s.
A well-diversified portfolio of assets, consumables, and ordnance wins the day. And it doesn't cost $179 and it doesn't disappoint.
“...your best position is to be where you cannot be bankrupted while the world around you bankrupts!”
I sound like a broken record, but do all you can to get OUT of debt and don’t get yourself into any MORE debt!
When you own nothing, you are in a much better bargaining place. And you’ll sleep better at night.
Get the whole family on board. I was a teenager in the 70’s and we had Carter’s incompetence to deal with. My folks sat us girls down and laid it all out for us. There WAS no money for college for me, so I joined the Army to pay for it. My sister went to college a few years later, but ended up racking up debt and moving from a private to a state college to finish her degree.
If you haven’t already, be HONEST with your kids. If you’ve raised them right, they WILL find ways to make their own dreams come true.
But, seriously, get out and stay out of debt. If you haven’t learned to live below your means, learn to do so now. Plenty of resources out there to help you. Dave Ramsey, for one. :)
I think you mean "OWE"....
the sky is falling for the umpteenth time.
Im not worried. Life goes on.
2020. Year Zero
".. please understand and never forget, “markets” have been ruled by financial engineering for three decades.
Derivatives (probably $2 Quadrillion now?) of all sorts will begin to blow up.
Whether it be because of the underlying interest assumptions, over concentration of paper versus deliverable goods (force majeure),
or just plain old outright insolvencies …you will witness the exact reverse (in albeit a MUCH shortened timeframe) than the buildup."
"As we warned you for years, “inflation of the things you need, and deflation of the things you have”!
I know, it’s a bad cocktail but exactly what we are faced with
… your best position is to be where you cannot be bankrupted while the world around you bankrupts!" (Emphasis mine)
I think You Got it.
Prepare the best and
Hope for the Best.
.
I ain’t running Into the
Freeway Traffic!
A system that uses currency based on the good faith and trust of the government has already broken down and has been out of order for years.
In a barter economy there is no such thing as inflation. Unfortunately, bartering is inconvenient. Using currency as a substitute for real value is tempting and convenient, but allows the issuing government to cheat.
You and I don’t issue currency. The government does. There is nothing you or I can do to devalue the currency. But the government issues currency and cannot resist the temptation to issue more money, money that is not based on anything of real value.
The fed has a target rate of inflation of 2%. They want inflation. They create inflation. They love inflation because it makes the “economic indicators” all go up, and the public is fooled into believing that the economy is doing well.
The economy has been a disaster for years. The fed lowered interest rates more than 10 years ago and they have remained low, essentially zero. Your savings are losing value even though the numbers are going up. Then the government has the chutzpah to tell you that the increased number of dollars in your account are going to be taxed!
“ AND the damage can not be undone. ”
If so, why would normal people not seek out and destroy the perps?
“I sound like a broken record, but do all you can to get OUT of debt and don’t get yourself into any MORE debt!
When you own nothing, you are in a much better bargaining place. And you’ll sleep better at night.”
Dave Ramsey was our professor re get out of debt.
One of our adult sons wanted a new pickup, those are running 40k and up. His wife had just closed her personal business and is starting a new one in this economy.
My wife and I in our 80’s and had a Honda Ridgeline and a Lexus. We didn’t drive them enough to keep their batteries charged.
So we gave an early inheritance, the Ridgeline, to them.
At first he was hesitant and wanted a new pickup.
Finally, his wife and us/his parents convinced him to take the Ridgeline and stay out of debt.
Just last week, his company which is downsizing removed one of his responsibilities and cut his monthly pay by 10%. He keeps the good part of the former job and the benefits. Also, he is not responsible for any people under him.
His wife will substitute teaching until her new business improves.
Meanwhile, they stay out of debt.
LOL! Yeah. If you ‘own’ anything, make sure Mother Government doesn’t know about it, LOL!
I think you mean "OWE"....
Little bit of both is probably closer to true. If you "OWN" your own home, you won't for long, especially when the left really decides to come for firearms. As long as you choose to participate in the American economy, you will always "OWE" something.
Im not worried. Life goes on.
___________________________
Life may go on,for some, but the quality is forever changed for the majority.
Sounds trivial (and it is), but the young working women in urban areas are now forced to forego or reduce their pampering expenditures, their travel addictions and their hobbies of eating in new, chi-chi restaurants. That cohort is one source of Biden’s & the DNC’s strongest support.
Young men cannot get accepted to top colleges or grad schools. People not yet on the property ladder are shut out. Baby formula is scarce. People with kids can’t afford to feed them as they have til now. Delivered food is very expensive. Cars are nearly not affordable and repairs are increasingly not possible. Hard assets, like boats and 2nd homes, are fast becoming a glut on the market. Taxes of all sorts are increasing. As long as The Emergency is officially still on, the medical tyranny is simply in a time out. The Controllers are going forward, tripling down and have no intention to back off or stop. Investments are losing value. Agricultural inputs are being strangled, forecasting less food supplies next year. Currencies are being devalued by inflation. A majority of the people on Earth are frozen in fear and indecision as their own governments mobilize to force medical and economic interventions.
I’ve missed some other indicators, but it’s pretty clear we are in the collapse and it is likely to accelerate. Worry is rational and panic is unproductive, but we are all in big trouble.
Didn’t the USA experience rationing during WW I and WW II?
Good dad :)
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