"Central Banks Are Petrified" Chris Martenson On The Hyperinflationary Threat Of "China Dumping The Dollar"

Tyler Durden's picture

Authored by Greg Hunter via USAWatchdog.com,

Resource analyst and futurist Chris Martenson says everyone should be taking notice of our “dangerous markets.”

At the center of the danger zone is the declining U.S. dollar.  Martenson explains,

We are talking about a steady erosion of the dollar as a reserve currency.  I think that is most likely.  The only thing that could make that really go fast is some kind of war.  The United States and China, we got to keep our eye on this because Trump has been threatening a trade war with China.  China responded and said if you do that, we may dump the dollar. . . . So, there is all this trade and financial back and forth and maybe even actual war at some point...

 

China has the ability to really impact the dollar in a big way on the world stage.  We better hope it does not come to that because a slow erosion we can adjust to; a quick erosion is going to really roil the markets and maybe blow a few of them up.”

artenson contends the U.S. could see hyperinflation in a short time if China “dumps the dollar.” Martenson explains,

“The way that works is let’s say they want to unload $500 billion on some Tuesday morning.  Who is going to buy that $500 billion?  Who is on the other side of that trade?  Well, if there are not enough people bidding for those dollars, the price has to fall until you find enough people to absorb those, and the dollar would fall in value against all other sorts of other things such as other currencies, oil, gold, silver and all those things...

 

We would be looking for a paired event.  What we would be looking for is interest rates starting to rise on Treasuries and the dollar starting to fall in value in value against a variety of things.  Once we see those two things, we know we have a financial war or a monetary war...

 

That’s what blows up the derivatives market.  That’s what makes difficulties for traders.  That’s what makes the high frequency computers say I don’t like this and bolt and instantly evaporate from the markets.”

Martenson also points out,

“The Dow is hitting all-time highs. So, it can’t be that bad, right?  The Dow is used as a signaling device, and it says have faith in your leadership and everything is fine.  Under the covers, obviously, things are not fine.  The people I talk to are nervous and worried. One reason is because it’s fall, and that is sometimes when we see these corrections, but the other reason is everything we track is getting more and more fragile. 

 

These markets . . . are held together by confidence. . . . I can’t tell you the number of people that used to be investors that say they just don’t trust these markets.  They are rigged and they understand that.  They don’t want any part of that.

In closing, Martenson contends,

“By many metrics, this market has never been more expensive. . . . What goes up has to come down. . . . I am convinced the central banks are so petrified to let a 1% or a 2% correction happen ...

 

What does it mean when the central banks are so petrified that they can even allow a correction to get started? That’s what people should be focused on.”

Join Greg Hunter as he goes One-on-One with Dr. Chris Martenson of PeakProsperity.com.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Deplorable's picture

Dipshits...Central Bankers!

J S Bach's picture

The laws of money and currency are as rock solid as any other law of nature.  History is awash with countless examples.  What the usurers have done to us they have done before.  The only difference this time is the scale.  When the whiplash finally comes... we must ALL point the finger of blame where it rightly belongs.  --->  (((Rothschild, Schiff, Warburg, Kuhn, Loeb, Goldman, Sachs, etc...)))

beemasters's picture

Let's hope it does happen. The last laughs will be on the central bankers when their ponzi scheme finally collapses.

The_Juggernaut's picture

Oh no, that would ruin the savings that nobody supposedly has.

Adullam's picture

Just so folk know where they will actually end up if they click (IN)sincerely yours' link...

https://biblicisminstitute.wordpress.com/2015/07/28/how-the-ashkenazi-je ws-conquered-the-west/

But don't worry, his alter-ego OneWarrior will be on defend himself.

What a sad example of Christianity. A liar, deceiver and thief. Oh, and he refuses to debate or back up his false claims at his site.

Blue Steel 309's picture

My favorite jew tactic is when you people chastise Christians for being bad Christians.

It is like a gentle reminder to get back to the 'values' that allow jews to exploit you.

yogibear's picture

Any Chinese treasury dumping will be met with quiet Federal Reserve treasury buying.

See China, your treasury selling can be instantly nuetralized! 

Want to try something else?

J_Peterman's picture

Absolutely - I don't see the Chinese drumping USG's as a problem since the Fed is buying everything in sight or lending to other central banks that are or would buy anything.

fx's picture

A drop of 1-2% is called a "market correction" these days?

As for dropping 500bn $ worth of treasuries at once, it is not as simple as that. The Fed and its helpers (TBTF banks) will happily snap them up, leaving the chinese with Dollar cash - with which they do what exactly? Buy tons of Gold, thereby pushing the price over 2000$ or 3000$/oz? Buy Euros for which they get a negative yield of 0.6% p.a.?

BS, I say. And btw, the Chinese need most of their vast fx reserves to run their huge exports and imports smoothly.

The Chinese are long-term thinkers and planners. They undermine the greenback one step at a time and they don't care if it takes 30, 40 or 50 years to reach their goal. One belt, one road is only the latest long-term project in a series of several. they dump their $ into hard assets and trade relations and influence allover the world and the US has no clue what to do about it. For 20, 30 years they are now watching but not doing anything about it and odds are, the next 20 years will be no different in this regard.

Paul Kersey's picture

"Central Banks Are Petrified" Chris Martenson On The Hyperinflationary Threat"

If that was true, then central banks, like the Bank of Switzerland, Bank of Japan and the Federal Reserve wouldn't be monetizing stocks (sending their prices higher), bonds and, in the case of the Fed, mortgage-backed securities. In fact, when China dumped all their Fannies and Freddies, the Federal Reserve scooped them up and stuck them on their balance sheet (to save the TBTF banks). In other words, if central banks were afraid of hyperinflation, they would be dumping these inflated assets rather than monetizing them.

cwsuisse's picture

The central banks can not permit the asset bubble to be deflated because this would cause a system collapse. The wish to avoid a collapse will always be stronger than the "petrification" factor. 

Conscious Reviver's picture

Re. Banks monetizing stocks. They have to. If they don't feed the Ponzi it will die. Think of all the collapsing pension schemes and insurance companies up to their necks in stawks. This is the end of the Bankster rip-off cycle. Stuck between a rock and a hard place, but they knew from the start that this where they would wind up, facing collapse. Run away fat ass Banksters run away. I see Stanley, Bank of Israel President, Fisher is already running for the hills.

TheReplacement's picture

I kind of agree.  I think, however, that they are monetizing in order to buy all of the things.  They don't care at what cost.  They just print more or fractionally reserve more into existence at no cost to themselves.  They won't allow this thing to blow up until it suits them > just a means to an end.  Of course, I highly doubt it will be their end that they are seeking.

They are statists and so are the Chicoms.  I have no doubt that the major parties are all working together towards the same ends.  I also don't doubt that each player at the table is looking for a way to be the one who comes out on top of all the others when they decide to finally invoke the end of all of the rest of us.

Edit:  No honor amongst thieves.

Xredsx's picture

But they have done worse than this, well, erm. Im sure the British will blame the EU. Everything is connected anyway. But yeah, they have done some very very bad and dark things. They engineered both world wars. Had planned a third too. You see, they had to destroy many different ideologies if they was going to make their nwo truly work.

Xredsx's picture

Who dare hit red? Look, Jacob schiff, the guy who funded president Woodrow Wilsons election. That president who got elected for his promise to keep American boys from the Great War. But signed the 16th Amendment instead. He also funded Leon Trotsky, the guy who Took over Russia and brought in Communism Russia. Jp Morgan funded Hitlers election while Gorge Bush grandfather made millions from the Nazi war machine. Oh trust me, i could go on and on. The truth about all of this is soooo bad. Once exposed it would actually unite humanity and bring peace on earth. By the right and with trade. But we have all got a hard pill to swallow tho.

Conscious Reviver's picture

The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.

Lord Acton

synthetically derived's picture

"Jp Morgan funded Hitlers election ..."

 

It is perhaps noteworthy that in this instance, J.P. Morgan didn't get an immediate bang for his buck (by financing Hitler's bid for the presidency). Although Hitler made it into the German presidential run-off election, he then lost rather badly to Paul von Hindenburg. Of course, Hitler wasn't long deterred by his failure to ever win a free election; not so many months after his electoral defeat, Hitler was appointed Chancellor of Germany (by 85-year-old von Hindenburg). From there it took little more than a false flag operation (i.e., the burning of the Reichstag [German Parliament]) for Hitler to gain complete control of the country.       

synthetically derived's picture

As you probably do know, history books tend to gloss over inconvenient truths. 

Five Star's picture

More than half of Chinese millionaires say they are thinking of leaving the China, 84% of whom cite concerns about yuan depreciation.

http://thesoundingline.com/half-chinese-millionaires-thinking-leaving-ch...

pitz's picture

Most of China's millionaires can't leave China -- their "millions" are tied up in their plant and equipment of their businesses.  Also, the Yuan is likely to appreciate dramatically in a postulated China collapse.  Unfortunately there is way too much cultural 'memory' of hyperinflation wiping out currencies, coming from a much different set of circumstances than China now faces.

beemasters's picture

Everyone in China seems to think the grass is greener on the other side... But the big fishes in China will never leave (for good) and be prepared to become small fishes elsewhere.

The_Juggernaut's picture

Yep. They'll definitely prefer the polluted shithole that China has become. For sure they'll want to stick around while their government nationalizes everything again, and there's no way they'll want to miss out on the food riots.

screw face's picture

...#DipShit #Bitchez 

..there fixed it for ya.

DontWorry's picture

If you had been listening to Chris Martenson since 2010 youd be living under  bridge by now

Laughing.Man's picture

Everybody is moving towards dumping the dollar.  I'm surprised Venezuela hasn't been invaded.

MaxThrust's picture

"I'm surprised Venezuela hasn't been invaded."

Be patient.

navy62802's picture

Gold mother fucker. Get some!

ludwigvmises's picture

Martenson has been talking of hyperinflation for over a decade. Broken record.

tmosley's picture

He's right though. You could have known that the dollar would collapse in 1971 when it went full fiat. You just couldn't guess how long it would last.

To break the world record for the longest lasting fiat currency, it would have to beat the "flying money" of the Yuan dynasty. Will beat their record in 2041, IIRC.

ScratInTheHat's picture

I pointed out to a co-worker that fiat currency was only as good as the power of the military backing it. He had never thought of that. When the Yuan dynasty lost its military power the paper became paper again. The only way you can make anyone see a piece of paper being worth anything other than a piece of paper is with a weapon.

SeuMadruga's picture

Yeah, "backed" by metal (Pb) !

ArthurDaley-OldieTimeTrader's picture

This is a replica of how the USD collapsing will be one time event.  Martenson is wrong until he'll be right in his views

 

https://www.youtube.com/watch?v=nFzu6CNtqec

 

 

Escrava Isaura's picture

Chris Martenson only?

The Martensons and the Kyle Basse’s of the world as well as most Hedgers cannot grasp that their religion were wrong. So, as in any religion, their believes blinds them of the facts.

Keep in mind that these three examples above are the orthodox view. The more moderate “internet” view, understand that the coming collapse has very little to do with the “orthodoxy of economics” but, with science (energy) because we live in a finite planet.

 

O C Sure's picture

Broken record????

How about LVM and the Institute incorrectly identifying money as a decree, that the introduction of new currency is not the opposite of "to do," to counter "feit," but simply a fiat. Or, identifying that money is debt and thereby overlooking that the debt has to be underwritten by existing currency or "new" currency "produced" by fiat, of course.

A nod and a wink allowing the squid to slither through.

100 years of that non-sense.

Now that is a record worth breaking.

coast1's picture

Just a bit off topic, but isnt our goal to get rid of the dollar?   Then why do people fight over crypto and PM's...Are we not all on the same page somewhat?   I chouse silver, and wont buy cryptos, but for all those that do, I truly wish you the best...I would argue with you if you invested in the dollar tho, lol....Lets just get along, invest in what you think is best, and lets simply hope ythe best for both crypto and precious metals...anything to fuck with the bankers, is ok wiith me....now stop fighting or I am going to send you to bed without dinner.....Actually, for those that buy their kids fast food, that is a reward, but you know what I mean :-)

p.s.  always copy your post before pressing send..Many times, I spent several minutes to write a good post and it didnt go thru....aaaaarg!

FreeShitter's picture

Well said, ending the cb's is the goal. Whatever mechanism(s) necessary.

Ilmarinen's picture

I see the crypto-pm arguements as good natured concern, even if it's clothed in sarcasm or worse.  PM want to warn crypto fans that if SHTF to the point of no power, you're out of luck with crypto.  Crypto sees PM fans missing out on the many immediate benefits that gold lacks short term.  I will be crypto short term, silver long term, if I can afford it.

rbianco3's picture

What if Western bankers were the founders of crypto and it was being used to mop up excess dollars in advance of de-dollarisation? Wouldn't that be a novel solution to minimize impending hyper-inflation? This of course assumes that crypto accounts will disappear one day as we cannot have crypto aiding hyperinflation- or can we? Hyperinflation means no more debt. No matter which way you look at crypto there are many rabbit holes to consider. 

The outlawing of crypto in China may be legitimate action to protect their own currency. But when you couple that with the apparent lack of concern about crypto in Western economies it makes me wonder if the West is playing a long-con and China is waking up to it.

How might accounts disappear? I'm a techie and understand the concept of crypto- but have not taken the time to verify the math works as advertised. Supposedly it would take enormous computing power to overtake miners and steal crypto- but what if a large economy were victim of an EMP atttack allowing hostile actor to reach critical mass computing? Can any real cryto experts having done the due-diligence say with certainty that a hostile actor couldn't move billions or more in crypto to a black-hole account- instantly wiping out unwanted 'supply'?

I enjoy playing the crypto casino AND physical so the comment isn't meant to throw water on the fire- rather some conspiracy-esqe ideas. 

Ilmarinen's picture

The excellent TV Show "Mr. Robot", which has a lot in common with fight club, has something similar to your idea about crypto ("E-coin" in the show) as the major plot arc between China-USA frenemy nations.

My limited understanding is that a 50%+1 attack is possible with bitcoin as you describe.  In the past, there was a bug that caused the blockchain to diverge - one "buggy" and one that worked as intended, and the miners voted to keep the buggy version for userfriendliness's sake.  In an attack like you described, when power was restored I would expect the blockchain to be split into pre-EMP and post, so the "malicious" copy could then be killed off.

karenm's picture

China has a central bank, so central bankers are not "petrified." They are working together to make this happen. Martenson is a shill.

Conscious Reviver's picture

Dig deeper. China prints its own money. They don't borrow it into existance paying a fee to the Banksters to make it happen like the crazy, corrupt arraingements in the West. This makes the Chinese central bank a kind of window dressing instead of the monetary king pins they are in Zino occupied areas of the planet.

Internet-is-Beast's picture

Lucky bastards. How did they ever get away wit that?

NemesisteM's picture

That $300 loaf of bread is gonna be damn tasty

HRH Feant2's picture

That would be the time to buy unground wheat and start making your own flour and bread. I grew up with a grandmother that baked bread once a week. It isn't rocket science.