It's not just the fear of recession from poor US jobs numbers driving the markets down. Stockmarkets are inflated compared the underlying economy. The loose monetary policy he's talking about in the video is money printing, by having low interest rates, that has blown a huge bubble. When cheap loans can be generated the money conjured up goes into buying things at whatever high price is on offer and the prices go up (of stocks etc).
In Japan, with the Yen carry trade, they had a choice between defending the value of the Yen by raising interest rates or looking after the markets with more cheap money. They raised rates. This impacted the speculators that borrowed cheap Japanese Yen and moved the money to higher interest rate countries to profit off the difference and then pay it back. With the change in the Japanese currency valuation, making it unstable (a risk), and the rising rates, this trade doesn't work, which is a spanner in the wider financial markets (check out the clip) because many things are connected. Other dangers are also present through the derivatives market betting (not mentioned in the clip).
As mentioned many times before, by many different online analysts; everything is being rigged. It has been since the 2008-2009 liquidity crisis, and before that, from after the 1987 stockmarket crash. Central banks have been buying stocks and driving up prices and stopping market corrections. The danger is that they may not be able to control things if there is a super large sell off. However, they may indeed be able to do it with The Fed stepping in to bail out all the losses like they did with the trillions they printed in 2008-2009.
We cannot know what will happen, but there are a number of drivers helping to push along a severe correction (wars, especially expanded ones that'll impact the oil trade, civil unrest, declining economic activity via higher interest rates in many parts of the world etc).
If things do go bad the lack of money will stop a lot of unsavory projects being pushed by governments and corporations. The world could benefit from a level of deflation and paralysis that stops harmful mass movements of people and money that has been distorting Western economies and society. Of course any severe level of chaos will likely be used by our puppet governments as an excuse to enact more control over their populations.
We continue to live in dangerous times where those in authority (compromised by special interests/donors) are a threat to the wellbeing of ordinary people.
Note: Part of the panic in the US markets has been driven by Warren Buffet dumping stocks.
[Posted at the SpookyWeather2 blog, August 6, 2024.]
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