Debt Bomb Archive
18 Jul 2018
Did the Powell Fed Just Light the Fuse on the US Debt Bomb?
The Powell Fed has decided to embark on an aggressive tightening schedule, with five more rates hikes while also draining an amount equal to Sweden’s GDP in liquidity over the next 18 months. The Fed believe it can do this because the economy is strong and inflation is rising. However, it has failed to account
17 Jul 2018
The REAL Reason the Fed is so Hawkish (And How to Play It)
The single most important bond in the world is the 10-Year US Treasury bond. This bond represents the “risk free” rate of return for a total economic cycle (roughly 10 years) denominated in the global reserve currency (the $USD). Put simply, this is THE bond to watch if you want to keep an eye on
17 Jul 2018
The Fed MUST Act to Stop the Everything Bubble From Bursting
The single most important bond in the world is the 10-Year US Treasury bond. This bond represents the “risk free” rate of return for a total economic cycle (roughly 10 years) denominated in the global reserve currency (the $USD). Put simply, this is THE bond to watch if you want to keep an eye on
17 Jul 2018
The Fed Will Soon Sacrifice Stocks to Save Bonds
The single most important bond in the world is the 10-Year US Treasury bond. This bond represents the “risk free” rate of return for a total economic cycle (roughly 10 years) denominated in the global reserve currency (the $USD). Put simply, this is THE bond to watch if you want to keep an eye on
17 Jul 2018
The Single Most Important Bond In the World is Breaking Out
The single most important bond in the world is the 10-Year US Treasury bond. This bond represents the “risk free” rate of return for a total economic cycle (roughly 10 years) denominated in the global reserve currency (the $USD). Put simply, this is THE bond to watch if you want to keep an eye on
17 May 2018
Here Are 200 TRILLION Reasons Why Rising Yields Pose a Systemic Risk
It’s a good thing that the BLS ignores things like the recent rise in real estate and gas prices when it generates its official inflation numbers… Why? Because if the BLS didn’t do this we might actually see that inflation is exploding higher. This is not conspiracy theory, it is fact. And if you don’t
07 Jul 2017
Did Junk Bonds Just Signal the End to This Credit Cycle?
Stocks are now in very serious trouble. The S&P 500 has fallen to test its “election rally” trendline. If the market breaks down here, there’s essentially one giant “air pocket” down to 2,200 or so. The bad news is that high yield credit (HYG), which leads the S&P 500, has already broken its respective trendline.
30 Jun 2017
Central Bankers Just Lit the Fuse on a $217 TRILLION Debt Bomb
As we noted yesterday, the world’s Central Banks have begun sending signals that the price of money in the financial system (bond yields) is going to be rising. Why is this a big deal? Because globally the world has packed on $68 TRILLION in debt since 2007. And ALL of this was issued based on
05 Jun 2017
Bombshell: The US Spent $20 MILLION Per Job Created From ’08 Onward
Since 2008 the financial media has been proclaiming that the US was in a “recovery.” This argument was used to justify the insane monetary policy of the Federal Reserve, which maintained ZIRP for seven years and spent over $3 trillion in QE. Well, it turns out there was no recovery to speak of when it
30 May 2017
The Corporate Debt Bomb is Ticking (Think 2000 All Over Again)
Corporate profits are rolling over again. Two years ago, corporations posted their first year of negative profit growth since the Great Crisis. We had a bounce from those depressed levels, which suckered a lot of investors into believing that fundamentals were improving. They were wrong. That bounce has now ended. Year over year profits are
23 May 2017
Subprime 2.0: Lending a $1 Trillion to People With No Proof of Job or Income
SubPrime 2.0 is proving far worse than even we suspected. If you’ve not been following this story, our view is that the auto-loan industry is Subprime 2.0: the riskiest, worst area in a massive debt bubble, much as subprime mortgage lending was the riskiest worst part of the housing bubble from 2003 to 2008. In
18 May 2017
THREE Charts That Tell Us the Next Financial Crisis is Closer Than Most Think
The election night bull market trendline is about to break. The only reason stocks have held up is hype and hope for Trump’s economic agenda. With the entire MSM, establishment shills, and deep state operatives trying to derail this, the market is about to lose this prop. More worrisome for the financial system: the long-term
13 Apr 2017
Yellen’s Setting Up the Markets For Their Third Fed-Fueled Crash
Janet Yellen is playing with matches next to a $20 Trillion Debt Bomb. During her speech at the Gerald R. Ford School of Public Policy in Michigan, Yellen stated that the biggest risk to monetary policy is for the Fed to “get behind the curve” regarding inflation. To that end, the Yellen Fed has already
01 Nov 2016
Did the $100 TRILLION Bond Bubble Just Burst?
Globally bonds are collapsing. Germany’s 10-Year Bund has seen yields spike out of their downtrend. As have Japan’s 10-Year Government Bonds. Long-Term US Treasuries have taken out their trendline. As have Junk Bonds. Folks, the bond markets are flashing DANGER DANGER. Globally the bond bubble is now well over $100 Trillion. And to top it
22 Feb 2016
Japan is Officially in the End Game
For over six years, the markets have been moving based on Central Banker actions and words. The first phase (2009 to 2013) was dominated by action (ZIRP and QE). The second phase (2013 to the present) was increasingly reliant on words (verbal intervention) as most Central Banks had by then used up 90% of their
19 Feb 2016
The Bond Bubble is Already Bursting… Here’s How We Know
As we outlined last week, the bursting of the bond bubble has begun. CNBC and the financial media may spend 99% of their time talking about stocks, but bonds are the single most important issue for Central Banks. When you consider everything in the context of the bond bubble, every Central Bank policy begins to
29 Jan 2016
Japan Just Lit the Fuse on a $9 Trillion Debt Implosion
Last night the Bank of Japan implemented Negative Interest Rate Policy, or NIRP. It is the second Central Bank to do so. The European Central Bank or ECB first went to NIRP in June 2014. Thus, between Japan and Europe, over 20% of the world’s GDP is being managed by a Central Bank with NIRP.
15 Jan 2016
The Bursting of the Bond Bubble Has Begun Pt 2
As we wrote earlier this week, bursting of the bond bubble has begun. The decision by Central Banks to “inflate” the system’s debts away post-2008 has resulted in the misallocation of trillions of Dollars of capital. The worst offenders were Chinese corporates. China has created the single largest mountain of bad debt in the world.
13 Jan 2016
The Bond Bubble Has Begun Bursting
The bursting of the bond bubble has begun. As I’ve outlined previously the primary concern for Central Banks is the bond bubble. CNBC and other financial media focus on stocks because the asset class is more volatile and so makes for better content, but the foundation of the financial system is bonds. And bonds are
21 Dec 2015
Deflation is Back… Will It Lead to Another Crash?
Central Bankers are flummoxed. Having cut interest rates over 600 times since 2009 (and printed over $15 trillion), they’ve yet to generate the expected economic growth. Despite these failures, the ECB, and the Bank of Japan are currently engaging massive QE programs. The Fed is the only major Central Bank not rapidly expanding its balance
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