Another major economy is facing the ugly prospect of rising inflation.
A central theme in our analysis of The Everything Bubble is that Central Bankers are focused on only one thing: maintaining the bull market in bonds at all costs.
The reasons are as follows:
1) Bonds are what finance the Government’s massive entitlement spending/ welfare programs.
2) With massive ownership of bonds thanks to over $15 trillion in QE, Central Banks are extremely exposed should bonds collapse (and yes, Central Banks can go bust).
With that in mind, we’ve been guiding our clients to focus on the dangers of rising bond yields due to surging inflation globally. Rising bond yields= falling bond prices. Falling bond prices=the bond bubble could burst.
And a bursting bond bubble= SYSTEMIC reset as entire countries go broke (think Greece in 2010).
On that note, China is the latest major economy to see its bond yields rise as inflation takes hold. Yields on China’s 10-Year Government bond are breaking out to the upside as I write this.
With China now experiencing higher bond yields (higher borrowing costs in the bond market), all FIVE of the world’s largest bond markets are warning of rising inflation: the US’s, Japan’s, Germany’s, and the United Kingdom’s bonds are all flashing “DANGER” with multi-year breakouts occurring in their 10-year bond yields.
The above chart is telling us in very simple terms: the bond market is VERY worried about rising inflation. And if Central Banks don’t move to stop hit now by ending their QE programs and hiking rates, we’re in for a VERY dangerous time in the markets.
Put simply, BIG INFLATION is THE BIG MONEY trend today. And smart investors will use it to generate literal fortunes.
Imagine if you’d prepared your portfolio for a collapse in Tech Stocks in 2000… or a collapse in banks in 2008? Imagine just how much money you could have made with the right investments.
THAT is the kind of potential we have today. And if you’re not already taking steps to prepare for this, it’s time to get a move on.
We just published a Special Investment Report concerning FIVE secret investments you can use to make inflation pay ou as it rips through the financial system in the months ahead
The report is titled Survive the Inflationary Storm. And it explains in very simply terms how to make inflation PAY YOU.
We are making just 100 copies available to the public.
To pick up yours, swing by:
Chief Market Strategist
Phoenix Capital Research