|
||||||||||||||||||||||||
We’re living through a once-in-a-lifetime financial event.
A global monetary reset.
People will tell you everything is fine, but if you look closely you can see the wheels flying off the fiat clown car in real time.
Most people will only accept this reality after the fact.
But the central planners clearly see the writing on the wall.
That’s why they are exit scamming into gold.
Central Banks are stacking bullion hand over fist, converting fiat promises into hard money as quickly as they can.
To understand what’s happening, you need to look at Japan.
They spent years suppressing their bond yields to try to spur growth.
And people took advantage of the artificially low rates by taking out loans in Japan, and sending tons of money overseas to search for yield.
This pumped global asset markets.
But now Japan is proving that Yield Curve Control is not the solution many people assume it is.
Because eventually it leads to real world consequences.
Namely, inflation.
A central bank can buy bonds in infinite quantities with the click of a mouse, but they can’t print energy.
Manipulation eventually leads to your currency buying less and less energy and commodities.
And digital manipulation manifests in the real world.
After years of negative rates, Japan has been forced to allow bond yields to rise to prevent the Yen from fully imploding.
So now the 10 year yield is going parabolic in the country with the highest debt-to-GDP levels in the world.
As everyone awaits the Fed to restart quantitative easing again, or even kick off Yield Curve Control if things get really hairy… It’s worth thinking a couple steps ahead.
If Japan is showing us the ultimate conclusion of yield curve control is unacceptable levels of inflation… Why should we think that Yield Curve Control in the US is a solution to anything?
Fiat currencies are slowly failing.
Yields cannot be suppressed forever.
And assets that have had valuations pumped up by artificially low interest rates may have a very difficult repricing in their future relative to hard assets.
Keep in mind that equities that have been fueled by cheap debt and stock buybacks would be repriced in a world where debt is expensive again.
Most people can’t imagine that scenario.
Still waiting for yields to fall back towards zero.
After 4 decades of falling interest rates, it’s all most people know at this point.
But gold being up 32% vs. Nasdaq year to date despite the AI boom is your sign that it’s time to pay attention.
The Treasury and Fed can make you think you’re getting rich by pumping up your equity portfolio with fake dollars…
But equities are already falling in hard asset terms.
When push comes to shove, commodities, energy, and hard money are the true measuring stick.
The Fed starting yield curve control (or whatever other name they come up with) is going to cause smart investors to look ahead.
They will look at Japan as the endgame.
And they will understand that a full reset is inevitable.
Gold has historically been the asset that has survived every reset.
And I believe Bitcoin will ultimately play a role too as people learn to value things that cannot be printed from thin air. Things with a real-world cost of production linked to energy.
But without (until?) a steady Central Bank bid setting a price floor for Bitcoin, I’m mentally prepared for carnage until the world figures out the value of a finite, neutral reserve asset.
WordPress’d from my personal iPhone, 650-283-8008, number that Steve Jobs texted me on
https://www.YouTube.com/watch?v=ejeIz4EhoJ0
Duck9 is a credit score prep program that is like a Kaplan or Princeton Review test preparation service. We don't teach beating the SAT, but we do get you to a higher credit FICO score using secret methods that have gotten us on TV, Congress and newspaper articles. Say hi or check out some of our free resources before you pay for a thing. You can also text the CEO:
