Great thread to help understand the extreme weather cycle we are entering due to climate change. I’m certain that this cycle will continue to cause major supply chain and commodity production problems
https://twitter.com/50shadesofvan/status/1463691097343938564
Climate change is likely to lead to decades of strong inflation. Perhaps hyperinflation when bond holders revolt on mass.
Our governements are unable to raise yields due to their debt to gdp levels. Raising rates will bankrupt most governments.
Our governements are unable to raise yields due to their debt to gdp levels. Raising rates will bankrupt most governments.
Continually low rates and increased monetizations of the debt is what we should be expecting. The I don’t know what the current amount of debt instruments add up to today. +$130t ???
The number is large enough for me to just declare it insanely large. $130t of paper promises. All of it nothing more than a promise for more paper at a later date. None of it inflation protected. No claims on real assets. No protection from rising energy and labour costs.
Physical commodities gold silver and uranium are a core part of my personal portfolio along with real estate. All are a store of energy and labour.
Other than that. Select resource companies make up the rest.
Other than that. Select resource companies make up the rest.
At some point there will be a bond holder revolt and the holders $130t plus paper will at first slowly try to exit and get inflation protection. The more holders try to exit bonds and get a claim on real assets the higher inflation of real assets will be pushed.
The buyer of last resort to protect the bond market and the banking system will be the central banks. The more they monetize the more they will fuel the cycle out of bonds. Always difficult to predict when panic will set in and a rush to the exits will occur…
Could be a soon could be a decade away. But for certain I like the insurance policy of owning real things vs paper promises from leaders of a broken system
When you invest in a commodity producer make sure management understands this cycle is upon us and is not positioning shareholders for 2 percent inflation and long term contracts out performing the spot market. Lol
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