Thread by @Kingbingo_

Financial markets across the developed world are breaking.
Give me 5-6 minutes and I’ll explain the why and how – but also sadly why there is no good outcome from here, only very bad and worse.

The 2020s are not going to be fun to live through.

A thread 🧵🧵🧵

By all means get your analysis from normie economists & journalists who are completely blindsided by all of this, but I have been on the record describing what’s coming for over 2yrs, see my interviews with @JamesDelingpole & @LozzaFox for a starter. [Links to those at the end]

Start with the most fundamental problem. For 50 yrs the west spent > earned, then borrowed money.
I’m based in the UK, yet we all live in a dollar based global financial system, so let’s start there with a quick look at the great webpage: usdebtclock.org

Lets start with the debt the US Gov has accumulated by itself, so ignoring Private debt, State debt or even promises to pay for the future, like pensions or Medicare
We are seeing $30tr in debt. Which is $245,191 debt that needs to be repaid for every single taxpayer in the US.

Now just that alone should be enough to produce am “oh shit – we got a serious problem!” reaction. But trust me, we are not even beginning to touch the scale of the problem we have here.

Next consider US Gov revenues last year, an impressive $4.8tr
And as anyone with any understanding of government will tell you, that is not the amount of revenue they feel they need to ask for, that is actually the absolute maximum amount of money that they can get hold of.

Yet that stupendous amount of revenue is predicated on certain base assumptions, like the US having abundant cheap energy, and being a global superpower with the ability to do business anywhere, anytime. Who knows if these assumptions will be true ten years from now.

Yet it is still short by a massive $1.2 trillion a year.

That’s enough money to buy single person who lives in New Hampshire, Montana, North Dakota & Alaska a new Lamborghini every year.

But as mentioned above that’s only current Gov debt. Add State & Local ($9878), unfunded liabilities ($515,285 per citizen) - all those promises to pay pension and medical costs to those Baby Boomers whose vote you have been buying with this debt for all these years.

And of course personal debt, another $70,991 each.

A grand total of $851,223 debt per US citizen or $2.2 million per US taxpayer.

The sum total of all US assets per citizen is only $551,019 per citizen, so even if you sold everything you still can’t get there.

But we can just eat the rich if we really need to right?

Well no, this video is an oldie, but if anything is even more true now than it was then, and explains why eating the rich is not the solution you might think it is:

I’ve picked on the US, but it's no better in any other western nation. Some of us have lower government debt to GDP, but then again we have way higher pension and medical obligations that are not paid for. So every developed nation is in very hot water.
forbes.com/sites/johnmaul…

So how can you solve a problem like the worlds biggest debt bubble in all of humanities history?

There are three ways:

1st method: You cut Gov to basically only doing roads & lighting, no pensions, welfare, state funded medical provision.
Keep taxes high for another decade+ until the debt has been paid.
If you think a political party offering this can win elections I want what you’re smoking.

2nd method: You default on all debt, just not paying it, sorry.
Congratulations, you just wiped out the entire financial industry, pensions, insurance & banking. because that debt is actually being held as their collateral from which everything they do originates from.

So money itself fails and now the farmer or miner has no incentive to feed the bottom of the supply chain because he can’t get paid anymore, so all global supply chains collapse.
Mass starvation & economic collapse follows.
Even if a new system later emerges at some point.

3rd method: You just keep doing what your doing, printing money to pay for this all and run inflation in the double digits for a decade or more.
By doing so you absolutely shit on wage earners, you shit on pensioners who can’t afford to buy anything, you utterly crush people.

But you protect the system, Govs, the elite, who will get far richer as their debt ⏬ and their assets ⏫.
Which option might the Davos mingling elites who run all global governments and every centre of institutional power across every aspect of the developed world prefer?

It's also possible the elite lose control, and the money system fails, and we get a hard financial reset.
Well in that case you want to own things that exist outside of the conventional financial system.
Things like Physical Gold, Bitcoin on your own wallet, and farmland.

Do any of the global elite suspect that the system might just possibly - maybe crash?

marketwatch.com/story/bill-gat…

Also if you think the financial system might have a hard reset, you might want to front run that event with – say…. A Great Reset?
Basically a set of policies that offer you enormously authoritarian controls with things like CBDCs and Digital IDs.

Which could be used to efficiently and brutally keep the populations in line – so that the same set of people who caused the crisis get to remain on top even after they have driven it straight into the ground.
weforum.org/great-reset/

Okay – so why in particular did the financial system go into meltdown on Friday and why is that meltdown going to accelerate in the coming months?

Well because believe it or not, even though there are plenty of individual ploys being conspired on by the elites – actually, day to day bog standard incompetence explains most of what we see.
This is something the Biden administration truly excels at – to an epic degree.

In his short tenure he has triggered an energy crisis at home and abroad – damaged global supply chains – retreated from Afghanistan in a way that clearly indicates the US is no longer a global superpower – destroyed faith in the dollar as a global reserve currency –

– given the entire world a burning desire to ditch the petrodollar, which wipes out the US ability to borrow effectively for free.

Amongst other massive own goals that we will be dealing with for many years. 💉

So when the Covid era inflation started to wash through the system –(those Covid era measures that all your normie friends and neighbours all cheered for because the telly told them too) – he panicked and pressured the Federal reserve to crush with high interest rates.

But that inflation wasn’t being caused by where interest rates were exactly, but by the vast amount of money printing that had occurred under lockdowns and the energy crisis.

Things that had already occurred.

You could set interest rate to any number you like, it won’t effect previous events– but it will result in higher costs today, trigger a massive recession – so you can’t afford to buy anything, and if you can’t buy anything it makes it look like inflation is coming down.

Well, no not really, its just causing demand destruction which superficially looks similar when you only consider a single metric – The CPI number.

What happened last week was chaos erupted in the markets that trade government debt.
An overly indebted system is simply incompatible with financial conditions that are not getting increasingly more expansionary (more debt, more printy).

If you want to drill into the nitty gritty this video is a great summary, although it is pitched at the already financially literate:

https://twitter.com/RealVision/status/1573401589846605849

But the basic version is so much of money is now being centrally planned, with incompatible objectives.

So what happens next.
Well either the financial system as a whole collapses in the next 90 days. And given that money is the other half of every transaction you are going to want to have enough calories hidden away.

Or, far more likely, the elites stop being worried about the proles revolting over inflation, and worry about economic collapse.
We resume our upwards trajectory of debt and printing.
You spend the next decade getting poorer and less free – probably the least worse outcome😢

You might wonder what you should be doing? – I have some thoughts:
Stop giving legitimacy to these awful governments - don’t believe their lies when they tell you which 3rd party is to blame for all this debt. The hard truth is the blame lies with government itself & the voters

Educate yourself on monetary alternatives like Gold & Bitcoin. (Not exchange traded gold or shitcoins).

Know how to secure your food supply from the source, go say hello to a local farmer.

Build a network of people in your area you can count on - if the shit hits the fan.

Links:

https://twitter.com/Kingbingo_/status/1432275473564831745

Links:

BTW, you may not care much for what some random dude on Twitter thinks, but here is Professor Siegel ripping into the idea this can all just be blamed on Putin, or on people asking for wages increases.
Its massive policy mistakes.

https://twitter.com/CNBCOvertime/status/1573387150338433025?t=Gghi9eSNwwIqafEAagDOAA&s=19