There's a lot of fear porn in here but there is a non-zero chance of some/a lot of this coming to fruition.

https://www.zerohedge.com/markets/how-bernanke-broke-world

Quote:

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How Bernanke Broke The World

Tyler Durden's Photo
BY TYLER DURDEN
SUNDAY, OCT 23, 2022 - 04:40 PM
Authored by Porter Stansberry via Porter & Company,

THE BIGGEST BUBBLE IN HISTORY DEFLATES

YOUR STANDARD OF LIVING IS GOING TO FALL IN HALF

Soon, you'll wake up to hear reports on CNBC and Twitter about ATM machines not working across the country.

JPMorgan Chase CEO Jamie Dimon will appear on CNBC, to explain that for the good of the country, his bank and all the other banks in the country are buying long-dated Treasury bonds. And, to protect America, it's important that we all take a pause and stop withdrawing cash from the system, which means a "temporary" shutdown of other banking operations for a week or two.

It will happen. It's unavoidable.

A couple of interesting facts…

The price of U.S. Treasury bonds is collapsing. Since the end of July, the 10-year Treasury rate has risen sharply, from a yield of 2.65% to over 4.3% now. There haven't been bigger losses in the U.S. Treasury bond market, EVER.…

…

Payback's A Witch
The sell-off in long-dated Treasuries isn't because of last year's inflation. It's because the market knows that the U.S. Treasury cannot possibly afford a real rate of interest on its massive $31 trillion in debt.

Think about it: this year's increase in Social Security benefits payments is 8.7%. At even half that rate of inflation, a 2% real yield on a 10-year U.S. Treasury bond would be well above 6%. If the U.S. government has to pay anything like that rate of interest to roll over its debts (average duration is 5 years) in the coming years, it is already bankrupt.

There are $24 trillion worth of publicly traded U.S. Treasury securities. At 6% interest, that's $1.4 trillion a year in payments. That's roughly 40% of total federal tax receipts.

This same kind of panic struck last month in the long-dated bonds of Great Britain. Now, along with big declines in long-dated U.S. sovereign bonds, the Japanese yen is falling apart, and the Swiss National Bank is suddenly accessing currency swap loan facilities from the Federal Reserve.

Most worryingly, liquidity is disappearing in the U.S. Treasury market, the most liquid financial market in the world. Analysts at Bank of America wrote yesterday that "the [U.S. Treasury] market is fragile and potentially one shock away from functioning challenges." That's broker-speak for "we're in uncharted territory here."

We are on the cusp of a complete panic in the world's bond markets. Like we explained last week, a global "Minsky Moment" is looming.

…

Lies, Damned Lies, And Printing Presses
I'm talking about Ben Bernanke. As the Chairman of the Federal Reserve from 2006-2014, he decided in the aftermath of the Global Financial Crisis that the banking system had to be saved, by any means necessary. To finance the massive losses which were over $10 trillion in the U.S. alone the world's central banks began printing money and buying government bonds to finance massive bailouts.

Like squirrels watching a bank robbery, the members of the Nobel Committee which recently awarded Bernanke the prize in economics saw everything that happened and knew nothing about what it meant.

Printing money doesn't cure economic problems: it simply skews who pays for them.

Printing trillions to paper over the financial system's losses moved the egregious errors of Bank of America, Bear Stearns, Lehman Brothers, Goldman Sachs, AIG, Fannie Mae and Freddie Mac, General Electric, General Motors and others from their balance sheets, onto the balance sheet of the U.S. Treasury and the Federal Reserve.

…

Altogether, the world's central banks have printed over $25 trillion over the last 12 years.

In the United States, the printing was equal to more than 30% of our GDP. In the Eurozone, the printing was twice as large over 60% of GDP. In Japan, the printing has been equal to over 100% of GDP.

You can think of these figures as being the size of the mirage we've been living in.

Reality looms.

Time to Opt-Out of "Money" Entirely
Our advice? Do everything you can to avoid holding the currency or the bonds of bankrupt western nations that have been trying to print their way to prosperity. And most importantly, do not let the current rally in the U.S. dollar fool you.

Yes, it's the basis of the current monetary standard and, as such, in a crisis it is where all the banks will hide. It could continue to strengthen for several more weeks or months. But it has no more legitimacy than the euro or the yen. And it is only a matter of time maybe only hours before it will begin printing again, trying to keep the system from coming apart at the seams. Maybe it will work but only after the value of the dollar (and the rest of the paper money) has fallen by 50% or more.

What will survive this crisis? Energy. Bitcoin. Land. Timber. Critical metals, like copper. High-quality, capital efficient businesses that aren't in debt.

What will fail? Anything that has to refinance debt in the next 5-7 years.

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C@LAg said:

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you forgot the "and it will be the republicans fault"

the warning sign will be when massive fencing goes up around Congress, the White House, Martha's Vineyard, and AOC is hiding in a building down the street.

If this were to actually happen, January 6 is going to be seen as a LARP event.

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Too late for that.

This is the classic expos of the Fed that has become one of the best-selling books in its category of all time. Where does money come from? Where does it go? Who makes it? The money magician's secrets are unveiled. Here is a close look at their mirrors and smoke machines, the pulleys, cogs, and wheels that create the grand illusion called money. A boring subject? Just wait. You'll be hooked in five minutes. It reads like a detective story - which it really is, but it's all true. This book is about the most blatant scam of history. It's all here: the cause of wars, boom-bust cycles, inflation, depression, prosperity. Your world view will definitely change. Putting it quite simply, this may be the most important book on world affairs you will ever read. The 5th Edition includes a no-holds barred analysis of bank bailouts that are shown to be nothing less than legalized plunder of the people. Many other updates have been added, including a revision to the list of those who attended the historic meeting at Jekyll Island where the Federal Reserve was created.

Bro just said Bitcoin at the end in a sentence with commodities.

And lost all credibility.

The only problem to solve in all this is who gets the 1.4 trillion in debt service from the US gov and what do they do with it? Because when we stop paying, cancel it, or whatever, those people will suffer but the country will be better off because they won't be able to borrow anymore.

As far as a run on the banks goes, if there will ever be anything that will get social media shutdown, it would be a run on the banks.

Washington Mutual was sold to chase bank in a silent auction for 1 billion because the media caused a run on it of 10% of deposits which it was able to borrow back from a texas oil company.

At the time it was sold it had 130 billion in assets including 30 billion in cash. The FDIC was trying to avoid having to pay out any insurance money to depositors.

Ultimately, the stock holders were the ones wiped out.

Where would RE (both residential and commercial) fall in this doomsday like scenario?

Pretty sure zerohedge was putting out these same types of articles in 2009. I remember reading one about planting your own garden because no one would have food in the grocery store.

Quote:

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Lies, Damned Lies, And Printing Presses

I'm talking about Ben Bernanke. As the Chairman of the Federal Reserve from 2006-2014, he decided in the aftermath of the Global Financial Crisis that the banking system had to be saved, by any means necessary. To finance the massive losses which were over $10 trillion in the U.S. alone the world's central banks began printing money and buying government bonds to finance massive bailouts.

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What time does the sky fall?

Exactly this, I was working an odd shift and doing a lot of OT back then and remember seeing this kind of stuff show up during the housing crash and gas spike. There's always a crisis looming but here's how to survive it.

Fantastic. Great job all around.

Those of you so sure it is fear mongering, can you attempt an argument against what the article predicts about the bond market?

Shooting the messenger is fine when the messenger makes a claim like "pull cash out now" and doesn't give a reason. But this article laid out multiple detailed reasons. And all are economically sound. They're even admitting that the crooks will likely try and bail the system out again. But the point of the article is that the bill eventually comes due, and we're entering a position we've NEVER seen in the bond market.

Stop reading zero hedge

I look at what Xi is doing in China and it makes me wonder if the Chinese know what's coming and are preparing. Zero covid lockdowns are grooming the populace for periodic shutdowns and civil servants are using it to practice for civil unrest. Xi is using a lot of language about perseverance and such. I would bet they are filling their strategic reserves right now not emptying them.

It's comical they still think they know what they are doing. It's comical they still think they can fix it. It's comical they still are in charge.

Xi is a communist a**ho**, who wants to total control. I don't doubt our world could change in a heart beat, but until they disarm us, I doubt it happens here.

1) I don't disagree that the article has a lot of sensationalism.
2) The BTC reference resonates with some, is a turn off for others, whatever.
3) The situation with the bond market is extremely concerning regardless of 1 & 2. The global economy is held together by a general sentiment that the USD is the cleanest dirty shirt in the hamper. The bond market issues outlined in the article are signs that it may be time to drop the hamper off at goodwill and get something new.

There is going to be a world of chaos the moment that sentiment shifts and I'd rather have a mixed bag of assets outside of the USD and dollar denominated securities just in case the S will actually HTF this time.

GAC06 said:

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Stop reading zero hedge

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Zero hedge didn't write it

1991sir said:

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Xi is a communist a**ho**, who wants to total control. I don't doubt our world could change in a heart beat, but until they disarm us, I doubt it happens here.

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Agree he's a bad dude with bad intent. But he and his team are smart. Could be complete coincidence but what he's doing and saying may be a hint about what they think is coming. Zero Covid is not about covid IMO. It looks more like dress rehearsal for other future crises. And our guns and ammo aren't going to determine if the bond market fails. We may be able to keep our government from taking the opportunity to go full Marxist but we are going to get slapped around by this like everyone else.

Try again. Guest authors predicting crashes versus pseudonyms predicting crashes. Every couple days someone posts another zerohedge impending disaster "article". Predict disaster 100 times, wrong 99, still can say "I told you so"

BoDog said:

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Where would RE (both residential and commercial) fall in this doomsday like scenario?

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Here's my answer:

You cannot own land, alone.

You own a promise on paper that the government will defend your right to a property, or that you have the right to defend it.

When the govt stops protecting your rights, all that is left is your ability to defend your property.

If you cannot protect it, whether land, gold, vehicles, bitcoin, etc.... what is the actual value?

There's some (at the WEF) that state "you'll own nothing and be happy,"owning indefensible property is certainly bound to make one unhappy, as it can certainly be an albatross around one's neck.

Good luck with paper promises from an unfaithful govt, should things come to pass.

itsyourboypookie said:

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Bro just said Bitcoin at the end in a sentence with commodities.

And lost all credibility.

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speaking of credibility,

Bitcoin is doomed, Dr. BITCOIN got arrested for money laundering!

/pookie

GAC06 said:

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Try again. Guest authors predicting crashes versus pseudonyms predicting crashes. Every couple days someone posts another zerohedge impending disaster "article". Predict disaster 100 times, wrong 99, still can say "I told you so"

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So what is it about the articles claims that you disagree with?

Maybe try for the first time before you ask someone else to try again.

Pretty much all of it, like the long list of similarly themed bull**** "articles" from zerohedge that didn't come to fruition yet people here still eagerly consume their fearporn

GAC06 said:

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Pretty much all of it, like the long list of similarly themed bull**** "articles" from zerohedge that didn't come to fruition yet people here still eagerly consume their fearporn

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Highlight a segment you disagree with and state why.

GAC06 said:

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Pretty much all of it, like the long list of similarly themed bull**** "articles" from zerohedge that didn't come to fruition yet people here still eagerly consume their fearporn

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The bond risk and concerns are real. Turn on CNBC and listen for a day or two. They have talked about it several times this last week across multiple experts and firms.

Writing all of this off as fear porn (while some of it certainly pushes that boundary) is ignorance from the other direction.

Adverse Event said:

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BoDog said:

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Where would RE (both residential and commercial) fall in this doomsday like scenario?

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Here's my answer:

You cannot own land, alone.

You own a promise on paper that the government will defend your right to a property, or that you have the right to defend it.

When the govt stops protecting your rights, all that is left is your ability to defend your property.

If you cannot protect it, whether land, gold, vehicles, bitcoin, etc.... what is the actual value?

There's some (at the WEF) that state "you'll own nothing and be happy,"owning indefensible property is certainly bound to make one unhappy, as it can certainly be an albatross around one's neck.

Good luck with paper promises from an unfaithful govt, should things come to pass.

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A lot of truth here. Society is held together by the common belief that what we have now is better than an alternate reality, whatever that reality is. You own property because we generally believe in private property rights in the US and thus we expect the government to help us enforce our claim.

In the case of a societal breakdown you have to figure out how to defend that property yourself. I've actually spent an unhealthy amount of time contemplating the physical security of my neighborhood and concluded we're about as good as it gets without running off into the woods and disappearing completely. Triangle shaped, one entrance at a point, heavily wooded on one side, thousands of acres of ranch land on another and a river on the third. Then add in the retired Special Forces operator and the other veterans we have here and I'm confident we can defend ourselves for an extended period of time. See, like I said. An unhealthy amount of time. Lol

If your plan is real estate that's great but the first thing to figure out is safety and security. Then food. If this all comes apart wealth preservation is irrelevant. Survival from the hungry masses looking to take what's yours is what matters.

Private PoopyPants said:

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Pretty sure zerohedge was putting out these same types of articles in 2009. I remember reading one about planting your own garden because no one would have food in the grocery store.

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So would you say that claims by ZH in 2009 were wrong? or early and you would've had a 10+ year head start on learning new skills to be self sufficient in the event of a food shortage, supply chain breakdown, or government totalitarianism?

Country and world can't set on its tail forever! Somebody has to get up work and produce a product worth having. We relied on China to do it and they made crap. US is at its laziest point in its history. People don't want to work but yet expect money and resources to just flow in? Get off your butt and build manufacture or grow something.

C@LAg said:

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a soft landing is off the table. the question is can we manage a hard landing and not a catastrophic crash.

it is not going to be pretty.

that said, both ZeroHedge and the Powell Group are hard right sensationalistic bear-market pushers, as well as crypto shills. Take anything pushed by them as outliers.

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ZeroHedge is also a venomous den of Russian Putin Bots and anti-semites.

I still read it though every day just to see what is going on around the world.

ThreatLevel: Midnight said:

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Private PoopyPants said:

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Pretty sure zerohedge was putting out these same types of articles in 2009. I remember reading one about planting your own garden because no one would have food in the grocery store.

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So would you say that claims by ZH in 2009 were wrong? or early and you would've had a 10+ year head start on learning new skills to be self sufficient in the event of a food shortage, supply chain breakdown, or government totalitarianism?

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Yes, they were wrong. I remember reading articles they published in March or April 2009 saying there would be no food supply within weeks or months due to immediate, impending, irreversible hyperinflation.