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When You Think The Financial World Can’t Get Any Crazier… This Happens
Submitted by Simon Black of Sovereign Man
When you think the financial world can’t get any crazier… this happens
The world has truly gone mad.
We’ve become accustomed somewhat in the last several years to historical anomalies such as zero percent interest rates, Quantitative Easing, competitive currency devaluation, etc. by governments and central banks the world over.
It’s almost become the new norm.
But then there’s always something that happens that shocks us all over again.
And just like with any other addiction, the infusion of ridiculous and unsustainable policies has to be that much more potent to have any effect.
Two such developments have just taken place in the financial world.
First, Switzerland became the first to issue 10-year government bonds with a negative yield.
Let that sink in for a moment.
Especially in the last year we’ve seen governments issue short-term debt with negative interest rates. But now the Swiss government is the first that will actually profit from its long-term 10-year debt.
It’s insane.
Just like in a bad infomercial—“But wait, there’s more!”
The government of Mexico just sold 100-year bonds denominated in EUROS. Also the first ever of its kind.
A few years ago, Mexico sold its first 100-year bond—that one was denominated in US dollars. Later, they sold another century-bond in British pounds.
You can just imagine the figures at the Mexican central bank’s meeting going: “Well, that went great. I wouldn’t have believed we could ever get away with that… Hey, what if we tried to do it in euros next time, haha?”
So they did. They took advantage of the European Central Bank’s unprecedented stimulus and issued a 100-year bond in a currency that most likely won’t even be around in the next decade.
Who’s dumb enough to buy this stuff—10-year debt at negative yields and 100-year debt in a doomed currency?
Institutional investors, of course—large pension funds and the like. You might look at news like that and think, well, that’s crazy, I’d never do that. But the fact is, it’s being done with YOUR MONEY.
Just like Winston Churchill commented that it’s false to characterize the fighting at places like the Somme, Verdun etc. in WWI as battles, when they were actually more like prolonged sieges, what’s happening in the financial world today is similar.
Currency wars is a term that’s been used frequently in recent years to describe what the world’s central banks and governments are doing.
In fact, this isn’t a currency war at all—it’s much more like a currency siege.
And when you think it can’t get any worse, it does.
Just like in WWI when nobody expected the amount of destruction and misery that happened. Heavy artillery barrages. U-boats. Tanks. Poison gas… It just kept getting worse and worse.
The financial world today is the same. Billion dollar stimulus packages. Quantitative Easing 1, 2, 3… Negative interest rates. Negative long-term debt yields. Cash withdrawal and transaction controls. Higher taxes. Capital controls…
It doesn’t stop. And it’s even getting worse.
Who are the losers now? Just like in WWI, they’re the guys in the trenches. They’re not the politicians making these decisions—the losers are the rest of us.
This isn’t a siege of one nation against the other. The siege is against us.
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Shhhh, I have a bag of Doritos, and Dancing with the Stars is on.
Don't forget to keep up with the Tardashians too, man. Trifecta!!!
Have no fear; Witchy-Poo and Uncle Jeb are running to run this once great nation of ours. Of course if it is a Clinton v. Bush ticket, the world will call us a bunch of ignorant inbreds and rightfully so.
Countless opportunities, risks often!
really, when you think about it, we should ALL be selling 100yr EUR bonds, callable at par, and just wait for EUR$ of like 25. the long side of that trade doesn't even have to be smart. you could put it in a negative-rate swiss acount and probably come out on top.
the seige isnt against 'us' so much as it is against Capital.
neg bonds > direct destruction of capital
savings deposits at next to no interest > suppressed capital growth
manipulating gold and silver lower > direct destruction of capital
stock bubbles set to burst > immanent destruction of capital
HFT and traders skimming > direct destruction of capital
inventory stuffing to deny reality of slack demand > direct destruction of capital
increasing money supply > direct dilution of capital
derivative expansion > direct dilution of capital
repealed limits on leverage > direct dilution of capital
stock buybacks > direct dilution of capital
all of the above contributing to crushed price discovery > direct destruction, misallocation and inefficiency of deploying of capital
Think like an Egyptian... no, like a Marxist.
But the fact is, it’s being done with YOUR MONEY.
Not with my dime Bud, unless you figure it as taxes.
May I just add: Bitcoin users not affected.
When BAC and GE have a negative dividend.....I am OUT!
Similar but better explanation: http://www.debtcrash.report/entry/i-bought-what
No, the world is calling you a bunch of exceptionally ignorant but arrogant losers who have lost the constitution they didn't deserve.
And what do your people deserve?
Stop insulting ignorant inbreds. I've never met one intent on hurting other people for personal gain.
Witchy-poo and Uncle Jeb? Mixed metaphor?
https://www.youtube.com/watch?v=yCtzyfiKCm4
Trolls into princesses. The miracles of makeup.
Fact is, it's NOT being done with MY money
I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do... www.globe-report.com
Tyler, delete this bot already. The fact that you tolerate this is absolute bs. Who is paying YOU? ABC... well then, I see.
You just got my upvote. Sick of seeing this MLM crap.
I want more nothing, at -2%, forever!
You can have your nothing. I'll take the buttwipe until the new buttwipe comes out.
"Who’s dumb enough to buy this stuff—10-year debt at negative yields and 100-year debt in a doomed currency? Institutional investors, of course—large pension funds and the like."
Of Course they do. They are playing with OPM (Other People Money). They post big paper profits by purchasing junk and collect their fees (based upon performance) and the fully know it's a lie, because these paper profits will vanish in when the market corrects. However, fees don't get returned back when the paper profits become monster losses. This game has been going on for more than 30 years and will continue as long as people are dumb enough to let these guys manage their money. Unfortunately their is an infinite supply of stupidity so this game will go until WW3 or there is a global economic collapse.
I wouldn't doubt that in at leasts some cases executives and gov't officials get kick backs and perks from the fund managers so they will turn over their worker pension and retirement funds. In most cases employees don't really have a choice in who manages there money. At best they are given a very limited set of bogus investment options will all end up enriching the fund manager and their expense.
The new Paranormal.
If the debt in Western countries is too large to be paid back, then Central Banksters have little choice but to have ZIRP and NIRP. 14 Western economies had NIRP and Spain joined them this week.
US debt and unfunded liabilities are $1,400,000 per taxpayer and rising at $70,000 per taxpayer per year. So NIRP will become a permanent feature of the US economy until the Great Collapse or Reset.
No rate normalization during my lifetime Bernanke
The insanity was allowing debt to rise to levels that it cannot be paid back.
Christine Lagarde is on PBS News Hour using works like "mechanisms" and "stability" and "responsibility".
What she really means is ways to cause more pain and suffering for households to benefit banksters.
The answer to government debt problem is to have our paychecks deposited directly into a government account. They take what they need to pay the bureaucrats, banksters and warmakers and send us a check for what they think is fair. Just a little more than EBT cards so that we think that we are winning.
That is quite the assumption, that this can be levitated that long.
How to classify this ROI: Government uses wealth stolen from you to buy bullets to use on you.
"Discuss..."
The banksters need to repay us.
"If that's a 'loosie' in your pocket, I'm going to have to choke you to death."
thats the problem. if people realized that if only a quarter of registered gun owners showed in washington, armed and stated that things will change now or you all will be removed by force, things would change... overnight.
that's just a hypothetical group. what if everyone poured in dc and said shit changes or you will be replaced. shit would change and quick.
if only.
Good comment, but in reality revolutions begin with "no."
It is when they come to violently enforce their edicts that our firearms come into play.
But even then, remembering Sun Tzu's advice:
"The general who wins the battle makes many calculations in his temple before the battle is fought. The general who loses makes but few calculations beforehand."
In other words, do not march on them with firearms unless all other strategies have been considered and marching on them is the only one assured of victory.
But even more importantly:
"Thus, what is of supreme importance in war is to attack the enemy's strategy."
In other words, do not go to the enemy, attack the enemy's movements against you, (Very successful in Vietnam.)
As a friend of mine says: "There are only two types of victory, luck, and predetermined; Luck is for the casino."
The banksters need to repay us.
"A lion only bites to eat what his claws have already killed."
When has the government ever backed down from guns?
Never
When have they backed down from political pressure?
100 times a day.
10,000 men or 1,000 women, properly organized, can make them do anything they want.
With respect, but they do not back down, they strategically withdraw, regroup, and then attack again.
Like the Real ID tyranny. They backed off, and then implemented it quietly by way of the backdoor in state drivers licenses.
As for this: "When has the government ever backed down from guns?"
The American Revolution for one.
The banksters need to repay us.
I should have specified the AMERICAN government. In the Revolutionary War it was the Brits who backed off from American weapons.
There are elements in government that never stop pushing for tyranny. Up until the 1970s Americans pushed back. Now the idea seems to be, forget organizing politically. Take a gun and shoot somebody. Except that never works.
You are right that the answer does not necessarily begin with shooting, but those of power will make sure that it ends that way.
However, unlike prior eras and areas of tyranny, the American people are also in a position that finds them inadvertently armed with a great and powerful weapon. That is the weapon of not paying.
If they withdraw their backs and no longer saw fit to pay on the banksters' fiat (theft) debts, the whole rotten system of tyranny would collapse right quick.
I must add though, history informs that tyranny does not simply walk away, but must be killed and skinned, we, the American people, must prepare for violence.
The most powerful weapon the American people have is Rejection.
The system of fraud and theft that has been built up upon the backs of the American people is dependent upon our backs. Withdraw our backs, and the whole scheme collapses. This is our greatest weapon.
Stop Paying--Put it into food, and precious metals, etc. They stole whatever "debt money" they loaned you in the first place (fraudulent-reserve banking) and soon you won't be able to pay them anyways, so Stop Paying.
Stop Playing--Stop being a tool for them to use, mock, and call "stupid." Stop Playing.
Stop Obeying--If they are in violation of the Constitution then they are not legitimate anyways, so Stop Obeying their unlawful dictates.
The Four Rs
Rejection: Stop Paying. Stop Playing. Stop Obeying.
Revolution: It is inevitable, so prepare, as they are.
Retribution: The guilty must answer for their crimes against the American people and the Constitution. No “truth and reconciliation,” but “trial and Retribution.”
Restoration: Restore the American people, country and Constitutional republic.
The banksters need to repay us.
Funny, it's mostly pistol ammo, if you're referring to the big DHS purchases. Mostly useless against a rifle.
It's not the gun you measure off against, it's the one holding it. And I'd say those with a uniform have proven plenty more willing to pull a trigger than those without, of late. And I don't expect a change any time soon. Doritos, remember?
Freedom Fighters have ways to get MIC hardware.
Wait long enough, pick it up for free.
"Wait long enough, pick it up for free."
For Freedom Fighters that live amongst or near their enemy, the primary strategy on hardware is to "deny."
"Taking" is the best form of "denying," but there is also "impeding" use of, and "destroying."
The banksters need to repay us.
Impeding: Hardware, and soldiers as well, are also not just objects, but systems. For instance, a helicopter is fuel, a secure operations base, secure storage facility, pilots, maintenance, parts supply, lubricant supply, parts warehouses, logistic convoys, etc. I.e. no fuel, no pilots, or no lube, use is denied.
http://www.globalsecurity.org/military/library/policy/army/fm/3-04-500/c...
Paying your own jailers.
Hard not to, when they have so many hired thugs in their employ.
Winning........
Ahh, what's the big deal? No-one holds to maturity anymore. Bond prices keep going up. Everyone knows they'll just sell at a higher price to the next greater fool. What could go wrong?
"Ahh, what's the big deal? No-one holds to maturity anymore."
For those that understand how the Zionist banksters' scam works, they understand that in the end the people hold the bag to maturity.
The banksters need to repay us.
The guillotine passes the bag back to the banksters and their violence-puppets, pols and crats.
kchrisc, I have given you so many up arrows lately, I'm starting to feel like I'm stalking you. I nominate kchrisc for Tyler.
Keep on reading.
Keep on thinking.
Keep on stacking.
Keep on loading.
The banksters need to repay us.
funny money in a funny world. a world gone mad. all served up to be observed and laughed at (for now-a temporary situation).
all the principles we grew up by are gone. sound money earned by labor is for the underclass.
going backwards fast, to an age of human darkness(again). at least the floor won't be dirt...
"In fraud she has become weary, and her great scum did not go forth out of her; her scum shall be in the fire." - Ezekiel 24:12
Scum, as in scum-bag?
No - it's really about Hilary and whatever demonic fluids animate her corpse today.
But your'e suppose to be polite and not notice.
let's make 1000 years bond in something as bad as barbarian relic
I got it. How about a Trillion Dollah Coin?
This is all perfectly logical as long as you have a solid plan for reselling the crap - say, into some state or municipal pension portfolio, which can be accomplished as cheaply as a few dinners at Ruth Chris's and a half-dozen trips to a decent strip joint. Or if you find a real sucker like Jefferson County you can sell it to them straight up at a premium and leave them thinking they got a good deal.
Crunch all you want, we'll make more !! There are always more sociopaths and deranged lunatics who will do whatever their superiors tell them, than decent people in the world. These deranged individuals will do anything for approval, money, a pat on the head, or for watever else. You are just in the way of their getting what they want, and they will do anything their are told to do, regardless of whether or not it makes any rational sense.
These are the people that will disembowel you, because you owe the state taxes, or you looked at them wrong at a traffic stop.
They're bought as collateral, not as "investments"...and don't forget these guys are YIELD-DESPERATE...they expect to flip these at a profit.
I hope they sold them to the Congressional Pension Fund.
from wiki: In the Bizarro world of "htraE" ("Earth" spelled backwards), society is ruled by the Bizarro Code which states "Us do opposite of all Earthly things! Us hate beauty! Us love ugliness! Is big crime to make anything perfect on Bizarro World!" In one episode, for example, a salesman is doing a brisk trade selling Bizarro bonds: "Guaranteed to lose money for you".
How did we all end up on the other side of the mirror?
Ask Alice.
I'd bet it was good drugs.
end up? sounds like you was equal back than
please remember 99% of "people" are never considert as "people"
Sure they are. They are just not "The People" (capitalization matters).
Can't be my money as far as I know; unless they rehypotheticated my IRS debt.
It is only done because the system and the people administering it are corrupt. If they were just idiots, they would not do it. However, they are paid well to lose the money that people entrust with them.
the Somme was a slaughter, just like the economic destruction going on today
The sheeple refuse to think. The sheeple trust their financial wizards. The sheeple trust their god to protect them. Oh joy, we await the Darwinian solution.
I'm sorry, but this makes perfect sense to me. If you don't get it, your perspective is flawed. Try this one.
"Institutional investors, of course—large pension funds and the like."
The banking mafia are brewing up the biggest robbery in history. They're going to pull the plug and wipe out the pension funds. By the end it will be just like Weimar with the banks owning everything.
Except one big difference this time - to prevent the inevitable backlash they made sure to turn the victims into a minority before they did it.
"They took advantage of the European Central Bank’s unprecedented stimulus and issued a 100-year bond in a currency that most likely won’t even be around in the next decade. Who’s dumb enough to buy this stuff—10-year debt at negative yields and 100-year debt in a doomed currency?"
still convinced that the EUR is a "doomed currency"? LOL. as a reminder, this is not the first time that the CHF was at negative yields, and the return of 100-year sovereign bonds is just that: the return of something that was quite common, once
the author should consider studying a bit more the financial history of the 19th Century, then our 21st Century is growing more and more like it
as a reminder, the Latin Monetary Union lasted from 1865 to 1927. That's 62 years. The EUR was "born" 1999. And it's behaving very much like the LMU
at the same time, Britons spent a few decades chanting that the LMU was "doomed", starting with Financial Times articles in... 1867
the "it's not a currency war, it's a currency siege" comment is a bit whacky
currency wars do look like sieges. this looks like another of those comments that make me wonder if the author even understands the mechanics of a currency war
The destiny of the Euro and the Failed organization called the European Union will be much clear soon when Greece tells the Sprouts in Brussels to take a jump .
escapeefromOZ, if Greece leaves... is what remains weaker or stronger? but of course the question is: do Greeks want to leave any club?
just recently the Greek government could have told the IMF to take a jump. guess what? They still want to keep being a member of that club
just recently Tsipras met Putin. guess what? Russia wants Greece to be a Russia-friendly country... in the EU, not out
meanwhile... Greeks still prefer to have the EUR instead of a Drachma. explain why
(wake up. if you are not being paid for this kind of comments, it's a good moment to wake up and smell the coffee)
Bonds with negative interest ? So the pension funds can give a monthly check of negative money and with that negative money a person can buy a lot of food , petrol , pay heating expenses, electricity , water and other taxes ........... in their dreams .
I have stopped keeping money in banks , the moment the rate of interest became 1,5 % , What could I do with that pittance ?
Use the bank only for pay automatic recurring bills and leave there no extra money . The rest of the money go to Silver and gold hidden away .
Jeb bush scares the holy shit out of me and I'm a dyed in the wool republican. Cankle hillary, well lets not even talk about that. She should be running for the nursing home.
Well, of course. Class war's very real and the bad guys are winning. And they don't plan to take prisoners.
The Mexican example does show up one particularly senseless aspect of QE. Investors in a desperate search for yield will now let Mexico City borrow money and essentially never have to pay it back. Mexican oligarchs duly excused from paying taxes get free money from DC. Poor whites in Gringoland are the ones paying taxes to feed the battalions of Mexico's Free Shit Army currently occupying most of the American Southwest.