Greece Just List the Fuse on a $9 TRILLION Collapse

Phoenix Capital Research's picture

The world continues to miss the forest for the trees.

 

Stocks are soaring today because Greece agreed to another austerity program. However, all this really means is that negotiations can begin for another Greek bailout.

 

Meanwhile, Germany’s Finance Minister, Wolfgang Schauble, the man who controls the purse strings for Greece, commented that a “Grexit,” may be preferable to another Greek bailout. Is this political posturing to force Greece to take a bad deal or a legitimate view that Germany has finally had enough?” No one knows. But it certainly doesn’t indicate that another Greek bailout, if it occurs, will go smoothly.

 

The bigger issue is the collapse of the Euro. The European currency has ended its bounce and is now rolling over sharply.

 

 

Why does this matter?

 

Because the Euro makes up 56% of the basket of currencies that price the US Dollar. So whenever the Euro falls, it pushes the US Dollar higher.

 

Globally, there are $9 trillion in US Dollar shorts in the financial system. These shorts are represented in the form of a carry trade: when you borrow in one currency to invest in another, pocketing the difference in interest rates.

 

The US Dollar carry trade is north of $9 trillion… literally than the economies of Germany and Japan COMBINED.

 

When you BORROW in US Dollars you are effectively SHORTING the US Dollar. Usually this is done with a LOT of leverage (sometimes an investor might have $1 in actual capital for every $50 he or she borrows).

 

So when the US Dollar rallies… you have to cover your SHORT or you blow up.

 

THIS IS A REAL PROBLEM FOR THE FINANCIAL SYSTEM AND IT IS MUCH MUCH LARGER THAN GREECE.

 

Indeed, the US Dollar correction looks to be over with the US Dollar having broken out of a falling wedge pattern. This is a VERY bullish development and it opens the door to a move to 120-130.

 

 

This will absolutely EVISCERATE that $9 trillion in US Dollar shorts. And it will IMPLODE the emerging market space as well as US corporate profits.

 

This is PRECISELY what kicked off the 2008 Crisis in July 2008.

 

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 are making 1,000 copies available for FREE the general public.

 

We are down to the last 25…

 

To pick up yours, swing by….

 

http://www.phoenixcapitalmarketing.com/roundtwo.html

 

Best Regards

Phoenix Capital Research

 

 

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Spectre's picture

This is exactly why I've just ordered 4 addittional train cars of Wheat/Corn and Rice.  Also 6 metric tons of beans, 10ea 55gal drums of canola oil, 2 more 1,000 gal propane tanks, 50 more cows and 25 pigs.

 

Cheers & Good eating