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MY CLUBHOUSE THESIS: HYPERINFLATION IS CLOSE

Discussion in 'The Kruse Longevity Center' started by Jack Kruse, Mar 11, 2021.

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  1. Jack Kruse

    Jack Kruse Administrator

    This is requires watching multiple times for any member of my site. It shows you exactly what COVID is and how it is being used to change the dollar to the IMF's SDR. Must watch.

     
  2. Jack Kruse

    Jack Kruse Administrator

    Some issues cropping up from Germany now credit wise where inflation expectations keep rising as markets no longer see inflation as a transitory phenomenon, but as something more permanent. German 10y breakeven rate rose >1.60%, the highest level since 2013. #Evergrande

    [​IMG]
     
    John Schumacher and JanSz like this.
  3. Jack Kruse

    Jack Kruse Administrator

  4. Jack Kruse

    Jack Kruse Administrator

    "Three weeks ago we did not see any imminent risk of a credit event occurring for Evergrande. Since then, there have been a number of setbacks which have led us to believe that a credit event seems unavoidable" - UBS
     
    John Schumacher, JanSz and caroline like this.
  5. Jack Kruse

    Jack Kruse Administrator

    PRC's current situation, in a nutshell.
    More than anything, they're flailing about to reconcile two fundamentally incompatible goals:

    1. Reinforce centralized control of the economy
    2. Maintain liquidity through high exports until domestic demand can offset export losses The failure cascades are undermining both.
     
  6. Jack Kruse

    Jack Kruse Administrator

    The world’s 25 richest families are worth $1.7 trillion, +$312 Billion over the past year. Also, Federal Reserve insiders have been actively trading the stock market while providing unprecedented liquidity over the past year. Welcome to finance. It has turned into a circus.
     
  7. Jack Kruse

    Jack Kruse Administrator

  8. Jack Kruse

    Jack Kruse Administrator

    The strange reality we are living in: the fact that Facebook can manipulate moods and sway elections using electrons/light is as disturbing as the fact that Google knows you better than you know yourself. Edward Snowden showed that the most paranoid netizens were right all along about our government.

    September 28th, 2021: 5 governors are now retiring. 3 of them out of the blue. 2 are not going to be renewed by Biden because he wants to put in leftists to get us to UBI faster.

    All of them are jumping ship just like they all did back in 2008 right before the crisis hit.

    Do you know your history well?

    In 2008, 4 of 7 Fed seats departed just weeks before markets started imploding.

    https://twitter.com/i/status/1442679706697052162

    Are you ready for Q4? This is when I think the water gets choppy.
     
  9. Jack Kruse

    Jack Kruse Administrator

    On the eve of the 4th Q there is calm before the storm.
    During bubbles Wall Street traders are filled with apparent fiat insouciance, yet with every opening bell they are desperately unhappy because they know the tolling bell might signal the end of the deck party on the Titanic
     
  10. Jack Kruse

    Jack Kruse Administrator

    Only the sky is the limit: ECB balance sheet hit another ATH as Lagarde keeps printing press rumbling. Total assets rose by €28.6bn to €8,273.2bn on QE. ECB balance sheet now equal to >80% of Eurozone GDP vs Fed's 37.3%, BoE's 38.8%, BoJ's 133.7%. equal to >80% of Eurozone GDP.
     
  11. Jack Kruse

    Jack Kruse Administrator

    CH thesis intact. Biden is killing us. The number of Americans applying for unemployment benefits rose for the third straight week, a sign that the highly contagious delta variant may be slowing the job market’s recovery. Jobless claims were up by 11,000 from the previous week.
     
  12. Jack Kruse

    Jack Kruse Administrator

    Why do Biden and Yellen want to tax unrealized gains? Since the Fed is printing money at high levels, there was no proof of work done economically for the economy. The cash was given to you. It's just like a King taking back the money you were given for no work or ROI. In this political environment, it's a way to reduce the velocity of money to quell potential chronic inflation. Most people know the infrastructure bill is very inflationary so trying to capture the unrealized gain is like giving Powell another tool to manage hyperinflation over a longer time. It makes no economic sense to a taxpayer because it is thievery but you need to realize that buying BTC and moving away from the USA is the key response.
     
    Sean Waters, JanSz, GavinH and 3 others like this.
  13. Jack Kruse

    Jack Kruse Administrator

    9/30/21 RRP was 1.6 T

    Why will RRP head to 2 Trillion soon? Because of the magnitude of QE, the market has a surplus of bank reserves & a shortage of collateral (treasuries). Fed reverse repo facility allows banks to park these reserves at Fed for 0.05% & borrow treasuries overnight.

    If they didn’t do this, treasuries on the front end of the curve would be bid nominally negative. Negative bond rates is a preterminal sign for the banking system. So this is why I predicted the RRP would grow massively in the 4th Q.
     
  14. Jack Kruse

    Jack Kruse Administrator

    Remember what the BTC series said about negative interest rates and banks?
    Present reality:
    Argentina: -13.4%
    Poland: -5.4%
    US: -5.2%
    Peru: -4.0%
    Eurozone: -3.9%
    Canada: -3.9%
    Australia: -3.7%
    Brazil: -3.4%
    Chile: -3.3%
    Norway: -3.2%
    UK: -3.1%
    Philippines: -2.9%
    Czech Rep: -2.6%
    Sweden: -2.1%
    Swiss: -1.7%
    India: -1.3%

    The inflation rates above are nominal government-issued CPI metrics. Actual monetary inflation as measured by asset price appreciation is much higher in all jurisdictions. Therefore the negative real yields are much worse than the numbers above suggest for investors.
     
    GavinH, JanSz and John Schumacher like this.
  15. Jack Kruse

    Jack Kruse Administrator

    One hour 11 minutes in is the golden nugget from @FossGregfoss Like a one-timer from the slot it catches nothing but net.
     
  16. Jack Kruse

    Jack Kruse Administrator

    This is why China banned BTC. I hope my macro-mitochondriacs are paying attn. ClubHouse thread getting juiced here in 4th Q
    [​IMG]
    China's power crunch overturning people's daily lives: blackouts, shops using candlelight to stay open, people trapped in elevators... But the drivers of the crisis aren't entirely unique to China...the world is reckoning with a bumpy transition to clean energy = cough. The WEF and Yale University hates when the CCP loses their clean energy bet.
     
    Sean Waters and GavinH like this.
  17. Jack Kruse

    Jack Kruse Administrator

    What does... • Gas • Coal • Carbon • Electricity Benchmarks all have in common? Smashing through records. What is also hitting multi-year highs? Crude and supply chains are just beginning to crumble = INFLATION is here to stay and this will lead to the deflationary spiral.

    Economists SHOULD be worried that the speed limit for the economy keeps going lower and lower in 2021. Now financial markets decide monetary policy, not the economy. Reversing the deflationary downtrend will be impossible until the debt bubble explodes due to spikes in "Inflation"
     
  18. Jack Kruse

    Jack Kruse Administrator

    Bonds are pricing that the dollar is going to weaken in the future. But if the dollar continues to rally, bond prices are likely to follow the dollar higher until mortgages gravitation pull it back. Mortgages will not allow the 10 Yr bonds to drift far. The refi market is dead and now the purchase volume feeling the pinch.
    Five years ago, most people you know didn't own bitcoin Five years from now, you won't know anyone who doesn't own bitcoin No societal paradigm shift has ever happened this fast a global scale
     
    GavinH, John Schumacher and caroline like this.
  19. Jack Kruse

    Jack Kruse Administrator

    Yesterday's news about the non-farm payrolls is going to set the Fed up to make a big mistake. Beginning with an increase in paper notes, continuing with the cancellation of the right to exchange them for the more precious coin, and culminating in the debasement of the coin itself, the State finally achieved “sovereign currency:” It acts like a handsome napkin.

    The Fed thought that when they turned off benefits to Joe Q Public, that people would run out and get jobs.......but they didn't. The number came in at 194K when it should have been 500K.

    There are 11 million open jobs and small businesses cannot find any qualified candidates = wage inflation pressures. Inflation is not transient. But will the Fed get the right message that tapering CANNOT happen at all?

    Vaccine mandates destroyed the non-farm payroll report due to a big negative number in gov't jobs where people quit. The economy is not recovering, it is actually getting worse. The weakness can be seen in the horrible participation rate of the non-farm payroll number.

    The Fed's monetary base is really affected by QE. The Fed's actions of QE tells us they think a reflation trade is ongoing, but it's not. When you invert the monetary base of the Fed's balance sheet you can see we are headed into a recession. Yet the WSJ published last night said that the "jobs report" is keeping the Fed on the tapering track.
    [​IMG]

    The Fed is desperate to taper its balance sheet by way of the RRP and this will torpedo the economy soon by raising the ten-year yield. It has already begun to rise. As the monetary base rises as the Fed employs QE = dollar weakens. As the Fed tightens the dollar goes up and this becomes a wrecking ball. Stagflation very rapidly becomes a deflationary spiral. What is a clue this is all going on? Banks should be buying bonds at record rates during this error. Guess what.......they are. Banks are buying T Bills to keep rates low so the government can function due to its high debt. If yields rise the risk of a real deflationary default grows.

    Any tapering will destroy the labor market = depression.
    We are riding the cliff edge … a gust of wind in either direction and well, the fall will be epic.

    HODL BTC during the fall.

    BTC is where the reflation will happen after some time.
     
    John Schumacher likes this.
  20. Jack Kruse

    Jack Kruse Administrator

    The debt ceiling issue just pushed the technical default to FOMC meeting on Nove 2/3rd. The prinicpal is not paid when we are in technical default. Money funds are required to value T-bills that don't repay at $0. This is a disaster for them as they could "break the buck (DYX)." So they will sell bills at risk of non-payment (higher rates). That risk has moved to December 2021. Still in the 4th Q but the nastiness is coming if the Fed tapers at all right now.
     
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