It appears to me that the time that I have been anticipating for a long time may have arrived.
As I wrote last week it took us from 1776 to 1980 to run up our first trillion dollars in debt. The last trillion dollars of debt took just 8 WEEKS. The bad news is that since then, we are up another $500 BILLION in just 20 days.(USDEbtclock.org) At this pace it will take around 6 WEEKS for the next TRILLION in debt to be piled on. I expect chaos shortly if this pace continues. Remember, in Weimar Germany everything seemed to happen all at once but the warning signs were there for years in advance- just like they have been here.
In addition to the rising debt there is a lot of short-term debt that is maturing that is being replaced with higher interest rate debt that is leading to even more debt to pretend that we can actually even pay interest on the debt.
Keep in mind that wars, etc. are off-budget and make the numbers even worse than they appear.
If that is not enough the collapsing economy is causing tax receipts to fall. In short, we have reached a point where if there was any pullback in the growth of debt the entire debt-based system could collapse in no time. If this continues, we can expect inflation to rise and probably rise far higher than many can imagine.
In my opinion this makes most bonds losers. The reason is- if “printing” were to stop many (probably most) bonds would default because of over-leverage at almost every level. If the “printing” continues the VALUE of that future promise becomes compromised and worth FAR less than what was originally expected. WHAT IS THE VALUE OF A PROMISE THAT CANNOT OR WILL NOT BE KEPT?
This should really come as no surprise since we know that the BIS (Bank of International Settlements) has mandated that all Central Banks have a digital currency by 2025. This is basically a new financial system that is being rolled out. Since a new system is planned it only makes sense that the system being replaced has to be done away with. (BIS)
To this end, the Fed started signing up banks in April for FedNow and rolled that out in mid-July. This allows banks to access instant “liquidity”. Last week Bank of America started taking commercial deposits and converting them to digital tokens. Today, (10-11-2023) JP Morgan rolled out TCN (Tokenized Collateral Network). This appears to be a way to convert collateral assets- like a money market to a digitalized token and allow for immediate transfers between different entities to settle trades or debts.
While this sounds convenient and is likely far more efficient than traditional methods of settlement it also could be the opening salvo of rolling out CBDCs globally.
While most of us outside of the inner circle can’t really know the exact timeline of this, we can look at some signs that we are approaching a breaking point.
#1 Debts and deficits are exploding with no end in sight.
#2 Costs are rising FAR faster than incomes are rising. This is likely the main reason for the many strikes that are happening right now. According to USDebtclock.org here is what has happened since the year 2000.
Year 2000 Today
Median Income $32,039.00 $ 36,056.00
Median New Home Price $167,255.00 $429,203.00
Median New Car Price $ 22,511.00 $ 50,755.00
Today, food, energy and basic needs are skyrocketing in price along with college tuition, healthcare and most basic services.
Get the picture? The lifestyle that we grew up with is becoming more and more unattainable for our younger generation. Dreams of retirement have become nightmares as every day expenses eat up most earnings and the average Joe and Jane are worried about next month’s bills rather than 20 years from now.
Other signs are:
86 MILLION on Medicaid (NO Assets) That is 26% of our population.
398,613 BANKRUPTCIES SO FAR in 2023 (10-12-2023)
115,611 Foreclosures So Far in 2023.
43 MILLION people are living in poverty and over 42 million are on SNAP (Food Stamps)
All stats from US Debtclock.org
These numbers paint a FAR more dire picture than what is painted on the financial game shows and by our “leaders”.
While many in the general public are blissfully unaware that our “money” is being debased in an almost tragic manner, the banks and central banks are well aware of what is happening. They have been buying gold in record amounts for years. I have been saying for quite some time that hard assets are the place I want to be. It appears that Citigroup agrees. It was reported by Mike Shedlock on Zerohedge that Citigroup has requested delivery of 100,000 TONS of Aluminum and 40,000 TONS of Zinc.
What do you think they know that you don’t know? Since I can’t directly answer that question I will say as I always do “Don’t listen to what they say BUT watch what they do”.
Be Prepared!
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