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The Fed's Policies Have Paved the Way For an Even Bigger Crisis Than 2008
The 2008 crash was a warm up.
Many investors think that we could never have a crash again. The 2008 melt-down was a one in 100 years episode, they think.
They are wrong.
The 2008 Crisis was a stock and investment bank crisis. But it was not THE Crisis.
THE Crisis concerns the biggest bubble in financial history: the epic Bond bubble… which as it stands is north of $100 trillion… although if you include the derivatives that trade based on bonds it’s more like $500 TRILLION.
The Fed likes to act as though it’s concerned about stocks… but the real story is in bonds. Indeed, when you look at the Fed’s actions from the perspective of the bond market, everything suddenly becomes clear.
Bonds are debt. A bond is created when a borrower borrows money from a lender. And at the top of the financial food chain are sovereign bonds like US Treasuries.
These bonds are created when someone lends the US money. Why would they do this? Because the US SPENDS more money than it TAKES IN via taxes. So it issues debt to cover its extra expenses.
This cycle continued for over 30 years until today, when the US has over $11 TRILLION in size. Because we never actually pay our debt off (or rarely do), what we do is ROLL OVER debt when it comes due, so that investors continue to receive interest payments but never actually get the money back… because the US Government doesn’t have it… because it’s still spending more money than it takes in via taxes.
This is why the Fed cut interest rates to zero and will likely do everything in its power to keep them low: even a small raise in interest rates makes all of this debt MORE expensive to pay off.
This is also why the Fed had the regulators drop accounting standards for derivatives… because if banks and financial firms had to accurately value their hundreds of trillions of derivatives trades based on bonds, investors would be terrified at the amount of leverage and the margin calls would begin.
The bond bubble is also why the Fed started its QE programs. Because by buying bonds, the Fed put a floor under Treasuries… which made investors less likely to dump bonds despite bonds offering such low rates of return.
This is also why the Fed is terrified of deflation. Deflation makes future debt payments more expensive. So the Fed prefers inflation because it means the dollars used to pay off debt down the road will be cheaper than Dollars today.
Again, when look at the Fed’s actions through the perspective of the bond market… everything becomes clear.
The only problem is that by doing all of this, the Fed has only made the bond market even BIGGER. In 2008, the bond market was $82 trillion. Today it’s over $100 trillion. And the derivatives market, of which 80%+ of all trades are based on interest rates (Treasury yields), is at $700 TRILLION.
The REAL Crisis will be when the bond bubble bursts. When this happens, it will be clear that real standards of living have been falling since the ‘70s and that sovereign nations have been papering over this through social spending and entitlements (a whopping 47% of US households receive Government benefits in some form).
Imagine what will happen to the markets when the Western welfare states finally go broke? It will make 2008 look like a picnic.
If you've yet to take action to prepare for this, we offer a FREE investment report called the Financial Crisis "Round Two" Survival Guide that outlines simple, easy to follow strategies you can use to not only protect your portfolio from it, but actually produce profits.
We made 1,000 copies available for FREE the general public.
As we write this, there are less than 50 left.
To pick up yours, swing by….
http://www.phoenixcapitalmarketing.com/roundtwo.html
Best Regards
Phoenix Capital Research
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Death to the fed. Revolution now.
Fuck the fed. Revolution now.
Look around you chaps the average jo has never left the recession.
The US is sinking into the abyss year by year since the 70's.
There is only one solution, we have to recreate a "producing" (working class) to have a healthy and growing economy.
A Hundred Trillion? Five Hundred Trillion notional? Hell, the Fed will cut a check for that. On second thought, why would they need to. Benny said interest rates will stay low for his lifetime.
Does that me he doesn't have long to live?
Neville Chamberlain was a Conservative PM who was refering his predecessor Disraeli in 1878 who returned from Berlin having avoided war over The Balkans. In fact incompetent diplomacy started the path to war after 1904 which led to both world wars and destruction of the British Empire which served the interests of the US.
Neville Chamberlain was British, Spencer-Churchill was American and created havoc such as loading the Lusitania with munitions with the aid of JP Morgan; Gallipoli and later on with stunts like bombing civilians in Germany to stop peace feelers in 1940, or proposing dropping anthrax bombs on civilians.
Spencer-Churchill maintained secret negotiations with FDR who used US Navy transmitters to circumvent the State Dept and worked against Chamberlain as PM who was closer to Joseph Kennedy, the US Ambassador.......the Narvik disaster was Spencer-Churchill's newest disaster for which Royal Marines died en-masse
National debt is 18 trillion - not 11. It was 11 trillion when Hussein became Piece of Shit of the US.
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Another spammer asshole....really?
You tell us your product is illegal, and you do so on a public forum board. You're as dumb as a box of rocks and so is anyone else who follows your "click here and go to jail service"
Is called honeypot.
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I'm starting to understand people's turning to religion.
At least your belief in invisible beings cannot be re-hypothecated and then leveraged 50x
while also being insured with derivatives that will destroy the world.
It's much simpler than that, God just moves his hand.
You should try focusing your thoughts on creation instead of destruction when contemplating the creator. That is unless you honestly believe that everything came from nothing because "science" says so. In that case, please prove 0 > 0, but only once and never again.
There be irony here. Argh.
An intelligent creator, seeing the depletion of resources on this world,
would create another similar world in the same orbit only 180* opposite
from our own. This would give us another 100 years at least.
1961 or 2015 this guy knew it then & warned us..... its seems the leaders didnt wanna listen https://www.youtube.com/watch?v=x8OmxI2AYV8
You might be right. but this could happen in 2030....
that's a lifetime....
In 2030 after the great crash of 2029 wipes out 90% of DOW value leaving the world most tracked index gasping for breath and struggling to stay above 50,000 those of us still alive will think of Phoenix and how they told us this was coming.
If only we had listened....
But …we have been told that this group of people is the smartest in the world and no one should ever “Fight the Fed”. Frankly, I think they are liars and idiots and history is on my side!
Smartest Keynesians, which is a euphemism for severely retarded individuals.
I thought the smart Keynesians were the hot money recipients. Severely retarded is reserved for the rest of us for paying their tab.
Reality shall not be allowed in the same way as Neville Chamberlain promised 'peace' after talking with Hitler, except Hitler was probably more honest than the bond market......
Have You No Shame?
How many times over the last Five Years, have you Cried Wolf?
Wolf is Coming Soon!!
Wolf is coming Next Year!!!
Wolf is coming Next Month!!!!
Wolf is coming Next Week!!!!!!
Wolf is coming TOMORROW .. OR THE NEXT DAY!!!!!!!!!!
You are sooooo pathetically Full OF Shit it is beyond belief.
The ONLY way TD publishes your crap is that you MUST have some really sleazy evidence on them.
Your ridiculous garbage needs to be deleted from this website forever.
R~E~L~A~X...Take a longer term view. Do you honestly beieive everthing is going to be O.K.?
I didn't give you a down vote because you've been correct - so far. LoL!