"Why are you buying treasuries when the US government shows no ability to collect the revenues to service it?"
Why, to keep the reserve currency-Ponzi racket going because we're afraid of the consequences if it deconstructs. And especially since we know about the FED put, that will back any threats to their fiat racket.
I say it with a satirical accent, but your question is astute, perceptive, and lays all the cards on the table.
The FED is like a Godfather mafia that has intermarried with the Euro and the Japanese fiat mafias. If you think about it, the US never left occupying Japan or Germany since WW11.
We're at the stage of the racket falling apart at an accelerated rate.
I want to thank Russell Clark for sharing his observations and thoughts with us, and look forward to more of Russell's posts.
I'm not entirely sure what to make of this. It's true that China wants to protect its reputation and ensure the stability of the RMB as a long-term store of value, especially for the "sanctioned and non-aligned" world (I should trademark that term!)
However all the available evidence seems to suggest that China has succeed in euthanizing animal spirits - in a high-income country this might be OK (ie: Japan) but China is still in its totality a relatively poor country (upper-middle income by the IMF/WB definition)
Look at the 30 year bond yields here, it's plain that Japan is on the brink or already has escaped deflation, while China risks sinking into deflation - especially since a crossover in 30 year bond yields (CN: 2.4% JP: 1.7%) appears imminent
God it is refreshing to subscribe to and read a newsletter written by someone who has a brain and uses it to think.
Best post for a while.
Great article!
"Why are you buying treasuries when the US government shows no ability to collect the revenues to service it?"
Why, to keep the reserve currency-Ponzi racket going because we're afraid of the consequences if it deconstructs. And especially since we know about the FED put, that will back any threats to their fiat racket.
I say it with a satirical accent, but your question is astute, perceptive, and lays all the cards on the table.
The FED is like a Godfather mafia that has intermarried with the Euro and the Japanese fiat mafias. If you think about it, the US never left occupying Japan or Germany since WW11.
We're at the stage of the racket falling apart at an accelerated rate.
I want to thank Russell Clark for sharing his observations and thoughts with us, and look forward to more of Russell's posts.
I'm not entirely sure what to make of this. It's true that China wants to protect its reputation and ensure the stability of the RMB as a long-term store of value, especially for the "sanctioned and non-aligned" world (I should trademark that term!)
However all the available evidence seems to suggest that China has succeed in euthanizing animal spirits - in a high-income country this might be OK (ie: Japan) but China is still in its totality a relatively poor country (upper-middle income by the IMF/WB definition)
Look at the 30 year bond yields here, it's plain that Japan is on the brink or already has escaped deflation, while China risks sinking into deflation - especially since a crossover in 30 year bond yields (CN: 2.4% JP: 1.7%) appears imminent
vs 5 years ago pre-covid (CN: 3.95% JP: 0.55%)
https://tradingeconomics.com/japan/30-year-bond-yield
https://tradingeconomics.com/china/30-year-bond-yield