It’s going to make 1933 look like a cook out.
Since capital markets are saying “no”, the Europeans will force their Central Bank to keep buying up the debt.
This is not over yet.
Karl’s concluding sentences-—
“”It will take just one — or maybe two — more events like MF Global and Greek CDS “determinations” before the entire market — all of it — goes “no bid” as participants simply stuff their hands in their pockets and say “screw this.”
It’s coming folks, and I guarantee you this: Whatever your “nightmare” scenario is for such an event, it’s not bearish enough.””
What is going to give the us (the US) breathing room in the near-mid term is the perception that we are the Global safe haven. In fact, the “Smart money” has been fleeing European banks & soverign bonds for “safe” US Treasuries for some time. But eventually we will be held to account to. When UST interest rates go over 5%, look for all H@ll to break loose as they true cost of the deficit cannot be swept under the rug anymore.
The current priority of the Fed is keeping UST interest rates low so that the Government spending party can continue. Everything else is decoration. The reason is simple: the Government effectively IS the Economy. If the Government is forced to live within its means, then most of the population will see either a partial or total reduction in income. It will be a SHTF situation like we’ve never seen.
The waiter appears with the check and you either pay it or wash dishes or go to jail. Ahhhh....but there are other choices. You tell the waiter that the Republican at the next table is picking up the tab. You can tip the table over and run away. You think Democrats play by the rules?
That won't stop Government. It won't even slow them down. The money is somewhere and they'll simply take it by force and they'll be more than happy to kill you if you resist.
Think your 401k or 403b is safe? Think again. That money is somewhere and Government can reach anywhere at all to get their paws on it. And believe me they will.
Money market funds, bond funds, index funds, ETF's, savings accounts, CD's, etc. aren't safe no matter what words are printed on those papers you have. All it'll take is one Executive Order and it'll be GONE. And there won't be a damned thing you can do about it. Nothing.
Get what you have out and get it out now, in cash. Then get yourselves ready to hunker down for a while, quite possibly a very long while. It's about to get really, really ugly out there folks.
And I've never in my entire life hoped more fervently that I'm wrong. Never.