Guest Post by Greg Hunter’s USAWatchdog.com
Analyst and financial writer John Rubino has a new warning about being fooled into thinking the economy is improving because inflation and interest rates have fallen some recently. Rubino says, “If the U.S. government is running crisis level deficits, which it is right now, borrowing money and paying interest on it means we are in a financial death spiral. The debt goes up, the interest on the debt goes up and that raises the debt even further, and you just spiral out of control. We are there right now. The official U.S. debt is $33.5 trillion. It’s growing by $1.7 trillion a year, and $1 trillion of that is interest costs.
Interest costs are rising as the overall debt goes up. Then throw in this incredibly reckless military spending in the guise of foreign aid, and you get a society that has completely lost control. That’s where we are now. We are in the blowoff stage of a 70-year credit super-cycle. Those things do not end with a whimper, and they certainly do not end with a soft landing. They end with a bang, and the bang is going to be centered on the currency.
People are going to look at this and say, ‘Do I really want to hold the currency or bonds of a country that is destroying its finances at this trajectory and this scale?’ The answer will be ‘No.’ At that point, it is game over for a deeply indebted economy. We are headed that way fast, and these wars are taking us that way even faster.”
If the Fed keeps raising interest rates, the economy tanks, but you protect the dollar. If you cut interest rates, you spike inflation even more, and the U.S. dollar tanks. Rubino says in the end, we get a “massive reset,” and the everything bubble explodes.
Rubino says the dollar is going to decline and, at some point, it starts to go into freefall in terms of buying power. Rubino explains, “If a currency starts to decline in a disorderly way, then you have a massive financial crisis on your hands. That is definitely where Japan is right now. The U.S. is headed that way fast. So, once we reach that point, there is no fix. Then it is only a matter of time that everybody realizes that there is no fix, and they just bail on the whole experiment, and that’s where we are headed.”
Rubino talks about plunging home prices, more trouble coming in the commercial real estate market and why you need gold and silver as core assets during a currency reset.
There is much more in the 40-minute interview.
Join Greg Hunter as he goes One-on-One with financial writer John Rubino and his new enterprise called Rubino.Substack.com for 11.18.23.
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Here we go! It’s been going slow motion for decades, but very few had the eyes and mind to see it. No more slo-mo. Now everyone on the street knows what’s happening–even the media whores and government half-wits are catching on. Like an approaching storm: some few can sense it coming a day away, but most don’t even know what happened until a week later they say “We’re not in Kansas anymore”. (These days they just call it the “New Normal”). There will be nothing normal about what’s coming. We have all lived in this blessed but increasingly insane and corrupt parenthesis of history that is more commonly known as the modern era. When all the bubbles pop we will be evicted from our cozy lifestyles and forced into a Hobbsian world of privation and violence. When the pendulum of reality swings back it will kick the whole world in the ass. Everyone…
You gonna run to the rock for rescue
There’ll be no rock
How did you go bankrupt? Slowly at first, then all of a sudden.
Russia-China de-dollarization almost complete
Western currencies have been almost completely phased out in Russia-China trade, as nearly all payments between the countries are now carried out in rubles and yuan, Russian First Deputy Prime Minister Andrey Belousov announced on Monday.
Since the introduction of Western sanctions on Moscow, Russia and China have accelerated the use of their own currencies in trade. According to Belousov, 95% of all transactions between Russia and China are now carried out in one of the countries’ national currencies, and given the rapid expansion of mutual trade and cooperation, this percentage is likely to grow.
https://www.rt.com/business/587666-russia-china-trade-national-currencies/
Consider that only 3% of “money” is in physical form. This is another reason (((they))) will EMP digital/internet. They can wipe out any proof of assets you “owned”. That is assuming those assets even exist given rehypothication/derivatives?
(((They))) control enough that it is a mere accounting gimmick to (((them))) and they can regain it while you wither away.
You got the conclusion exactly backwards.
The psychopaths in power understand full well that -with only 3% of “money” is in physical form- this is their greatest lever: to manipulate all the physical assets with completely made-up imaginary money (your “97%”, but in reality more like 99.99%).
To destroy that lever by EMP’ing all digital would be an inconceivable blunder by them, and will never happen if they can anyhow avoid it.
Thie is going to be a disaster on a Roman scale. It will be ‘crash -bang bang bang bang. Civil war and World war. Every country on earth is tied into fiat money. When people lose everything they are going to lose it. I think lead will be the most valuable metal .
Argentina says, wait for me!….
The Far-Reaching Implications of Javier “the Wig” Milei’s Election Victory in Argentina
Milei’s is also talking about abolishing the peso and replacing it with the US dollar instead. A milder form of this policy was already tried in the early 1990s, when the Menem government in Buenos Aires fixed the exchange rate at a wholly artificial and unsustainable value of one U.S. dollar. This gave the country a false illusion of prosperity while making the economy uncompetitive and depriving the state of having an independent monetary policy. It ultimately paved the way to the financial crisis, and currency devaluation and deep recession of 2001, from which Argentina’s economy has never properly recovered.
What’s more, Argentina, on its own, is not in a position to undertake dollarization since for two simple reasons. As Alejandro Werner, former director of the Western Hemisphere Department of the International Monetary Fund (IMF), told America Quarterly, “Argentina does not have the dollars to dollarize, and it does not have access to the financial market to obtain dollars.”
That is, for once, a blessing. After all, if Argentina were to fully replace the peso with the dollar, it would mean the end of any semblance of Argentinean sovereignty, as the South Korean economist Ha-Joon Chang warned during a recent visit to the country:
Special currency swap arrangements signed between Buenos Aires and Beijing in June and July this year have enabled the Argentine government to continue servicing its $44 billion loan package from the IMF, thus avoiding yet another default. That credit line could be at risk if Milei maintains his hard line toward Beijing. It is not hard to imagine, for example, his government blocking key Chinese investments in strategic sectors, including Vaca Muerta, an oil and shale gas reservoir in Patagonia that holds the world’s second-largest shale gas reserves and the fourth-largest shale oil deposits.
Milei has also said that his government would endorse and apply the Collective West’s sanctions against Russia, adding: “I would never support an autocratic government like Russia’s.”
In other words, on the off chance that Milei doesn’t cancel Argentina’s BRICS membership, its is unlikely that the BRICS’ founding members will continue to endorse the membership of a country whose government supports US and/or EU sanctions against a fellow member. In such an event, it will be interesting to see whether or not the founding members opt to invite another Latin American country to replace Argentina, with the two most obvious candidates being Bolivia and Venezuela.
The economy is in the toilet. GDP is being driven by government spending which is helping no one except the oligarch’s. Consumer spending is decreasing because the average American is taking it up the ass.
The 10yr Treasury rates are being suppressed by the Fed using the overnight fed funds account to buy up US Treasuries in order to keep down interest rates. That account they are using to by those Treasuries is being drained so fast it will be out of money in about 3 mos. They have now taken their chart off the internet because they are trying to hide what is happening. When that account is drained, the Treasury will have to borrow at market rates and the interest rates will not only skyrocket, but liquidity will dry up for both business and consumer borrowing which will cause a crisis and a steep drop in the economy.