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July 9, 2024 Readings

July 9, 2024 Readings

The meme that is destroying Western civilisation Part V–Steve Keen

Food Ecomodernism And The Emptying Of Politics, Part 1–Chris Smaje

Global News Round-up: Let them Eat Bugs–Robert Malone

After Leftist Lobbying, German Bank Kills AfD Donation Account–Armageddon Prose

Weak Data Says a Recession Has Already Started, Let’s Now Discuss When – MishTalk

Corporate Media Is An Unreliable Narrator–Matt Orsagh

This Civilization Is Not Interested In Saving Itself–The Honest Sorcerer

OMG Haaretz Is Hamas Propaganda Now! – by Caitlin Johnstone 

Alaska’s top-heavy glaciers are approaching an irreversible tipping point–Bethan Davies

‘I had to downgrade my life’ – US workers in debt to buy groceries–BBC News

The Public Cost of Private Science–Nautil.us

No Reform or Leader Is Going to Save the Status Quo–We’re On Our Own–Charles Hugh Smith

NOTHING ELSE MATTERS – The Burning Platform

It’s All MMT: The Fraud Of ‘Monetary Policy’ | ZeroHedge

Master Class On Strategic Organised Resistance: Class 1–Collapse Curriculum

From Prosecutor to Censor: Barbara McQuade’s Call to Erode Free Speech–Reclaim The Net

100 Miles South Of Salt Lake City, A New Type Of Off-Grid Community | ZeroHedge

US Farmers Hoard Corn Like It’s 1988 | ZeroHedge

July 6, 2024 Readings

July 6, 2024 Readings

The meme that is destroying Western civilisation—Part III–Steve KeenI

World’s Largest Fusion Reactor is Finally Completed, the Test Run Is 15 Years Away – MishTalk

George C. Marshall, Architect of U.S. Military Expansion, the Post War European Reconstruction Marshall Plan, Founder of the Orwellian “Deep State”? – Global Research

Back in the USSR. Are We the Soviets Now?–Robert Malone

David Stockman on Why the Federal Reserve is Running Out of Monetary Oxygen–David Stockman

Finland gives US control over 15 military bases–InfoBRICs

Can We Rest Assured That Just Because of the Unacceptably High Costs of Nuclear War and World War III, These Will Never Happen? – Global Research

Russia Finally Acknowledges That She Is at War with Washington – Global Research

Biden and Trump Battle over a Rattle – Edward J. Curtin, Jr.

Who Turned Off the Gaslight–James Howard Kunstler

War Games | how to save the world–Dave Pollard

Crash Or Bear Market, Either Way Stocks Going “Down, A Lot”: Mark Spiegel–Quoth the Raven

10 Signs That Global War Is Rapidly Approaching–Michael Snyder

The coming population collapse — Part 2 | by Subhash Kak

‘They’re Everywhere’: Common Foods Linked to Elevated Levels of PFAS in Body–Common Dreams

Russia Holds Mobile Nuclear Missile Launcher Drills Days Before NATO Summit In DC | ZeroHedge

July 5, 2024 Readings

July 5, 2024 Readings

Move Over, Disaster Capitalism–Make Room for Addiction Capitalism–Charles Hugh Smith

No Escape From Unchecked Government Spending and Deficits…Here’s The Proof–Crisis Investing

Doug Casey on Revisionist History and How the Good Guys Don’t Always Win

Houthi Attacks On Ships Soar Most This Year In June As Critical Maritime Chokepoint Ablaze In Conflict | ZeroHedge

Cat 4 Hurricane Beryl Heads Towards Texas, Threatening Major Oil Refineries | ZeroHedge

Craig Murray’s Campaign Against Empire – Read by Eunice Wong

Egypt Teeters On Brink Of Economic Ruin As Public Debt Mounts, Poverty Rate Soars | ZeroHedge

Green New Scam Is Dying – The Daily Reckoning

The Massive Harm of LNG Fracking, Tallied | The Tyee

The Status of U.S. Oil Production: 2024 Update Everything Shines By Dimming – resilience

The Systems Within–Earth4All

From Milk Runs to MAD to Madness | Mises Institute

Borneo’s Dayak adapt Indigenous forestry to modern peat management–MongaBay

Brace for Peak Impact | Do the Math

It’s Too Hot For Trains In Canada–Guy McPherson

This Civilization Is Deeply Unnatural–Caitlin Jonstone

The Media Don’t Get Degrowth–Degrowth Is The Answer

From Milk Runs to MAD to Madness | Mises Institute

The Awesome, Terrifying Power of the Press

Scientists And Farmers Restore Aztec-Era Floating Farms That House Axolotls–MongaBay

Rebuilding the flax / textile industry as a commons: Fantasy Fibre Mill

Reporters Blame “Right-Wing Media” for Their Failure to Disclose Biden’s Infirmity – JONATHAN TURLEY

July 4, 2024 Readings

July 4, 2024 Readings

Petrodollar Panic: Separating Fact From Fiction – RIA

The Politics of Exhaustion–Aurelien

“Gaza Is Complicated.” No It Isn’t, Grow Up.–Caitlin Johstone

Germany expanding intelligence services amid its “preparation for war” with Russia–InfoBRICS

Large Maneuvers of War in Europe Under US Command. Manlio Dinucci – Global Research

The meme that is destroying Western civilisation–Part 1–Steve Keen

“No” To A “Green Energy Transition” “Yes” to An “Energy Reduction Transition”–Kollibri Terre Sonnenblume

Iron In The Blood–Zero Input Agriculture

Drumbeats of a Greater Israel War – by David Haggith

Oh No, Now The US Has To Stop Imprisoning Ex-Presidents For Their Crimes!–Caitlin Johnstone

Orwell’s “Two Minutes of Hate”, False Flags, The Deaths of Children … and the Escalation of Warfare – Global Research

Unveiling the Brennan-Clapper Files: How January 6 Shifted Surveillance Powers–Reclaim the Net

We’re All Living Season 5 of “The Wire” – by Matt Taibbi

Out-of-Control Government Spending Will Break America… And It Just Got Worse–Crisis Investing

How To Obtain REAL Independence… Minimizing the State’s Ability To Coerce You–International Man

The US Is A “Runaway Train” | ZeroHedge

Looking Back, Looking Forward–Chris Smaje

What Does Collapse Look Like? – David Moscrop

240,000 people evacuated in China rainstorms–Phys.org

Startling: Humans Are Absorbing Microplastics, and It Is Increasing Our Risk of Cancer, Diabetes, and Heart Disease–SciTechDaily

Climate change is pushing up food prices — and worrying central banks–Financial Time

Carbon Cataclysm: Scientists Shed New Light on Ancient Apocalypse That Affected the Entire Planet–SciTechDaily

July 2, 2024 Readings

Groundwater Depletion Maps Reveal Depths of “Extreme” and “Exceptional” Mexican Drought

Saudi Arabia Breaks US Global Power?

Very Hard Times are Coming – Charles Nenner | Greg Hunter’s USAWatchdog

“The Train Has Left the Station and No One Can Stop It”. Europe Will be at War with Russia. Serbia’s President A. Vucic – Global Research

Debt Brakes and Treaty Requirements About to Smash the EU – MishTalk

Brazil’s Supreme Court Is Hiring Contractors To Monitor Social Media and Track Dissenters

EU’s Mass Surveillance Faces Fierce Resistance

The Delusion of Advanced Plastic Recycling Using Pyrolysis — ProPublica

‘Gold mine’ of century-old wheat varieties could help breeders restore long lost traits | Science

David Stockman on The Ukrainian Border War Folly – International Man

Episode 61: Psychological Warfare in Pharma Marketing ft: Robert Malone

U.S. Government Historical Debt – by Lau Vegys

Ticking Time Bomb: Space Junk Is Eating Away at Earth’s Ozone Layer

Big Tech Coalition Partners With WEF, Pushes “Global Digital Safety” Standards

World Economic Forum Pushes For AI Use and Collaboration in Fighting “Misinformation”

Wellbeing: UNCONNECT – by Robert W Malone MD, MS

Big Brother on Board: UK Train Stations Use Amazon-Powered AI to Read People’s Mood

The Failure of Switzerland’s Burgenstock “War-Peace Conference”, Russia Not Invited – Global Research

The Confiscation of Reality ⋆ Brownstone Institute

The Entire System Is Crumbling! Major Red Flags Are Popping Up For Banks, Small Businesses And Retailers

The Madness of War. Another Cuban Missile Crisis? USA and France Court Global War. Rodney Atkinson – Global Research

Science Snippets: The Ability to Grow Food is Threatened by Climate Change

Red Sea Diversion Causes Congestion at World’s Busiest Port | OilPrice.com

As Inflation Rises, Prepare for Crime | SchiffGold

“Remarkably Lopsided”: NYT Bestseller Bias Laid Bare | ZeroHedge

The Smoking Gun: Who Started the War. Was it Russia or Was it US-NATO? NATO Confirms that the Ukraine “War Started in 2014” – Global Research

June 30, 2024 Readings

St. Petersburg International Economic Forum (SPIEF) 2024: Marking the Rise of the Global South Century and Decline of Western Economies

Up to half a million NATO soldiers waiting to enter Ukraine

It’s the End of the World As We Know It. The American-NATO Rush Toward Nuclear War with Russia. Scott Ritter – Global Research

Our Rulers Are Literally Driving Us Crazy

Doug Casey on Insider Trading… Why Politicians Can Do it and You Can’t

You Keep Using the Term ‘Authoritarian’ ⋆ Brownstone Institute

Over 80 UK war planes deployed from Cyprus to Lebanon since 7 Oct: Report

Dam In East Texas On ‘Potential Failure Watch’ | ZeroHedge

Lithium: A Clean Energy Solution with a Dirty Secret | OilPrice.com

Iran Threatens Israel With ‘Obliterating War’ If It Attacks Lebanon | ZeroHedge

Low snow on the Himalayas threatens water security: Study

Groundwater Depletion Maps Reveal Depths of “Extreme” and “Exceptional” Mexican Drought

The Supreme Court Punts on Censorship – by Matt Taibbi

Sky’s the Limit For Our Debt and the Money Supply

It was the media, led by the Guardian, that kept Julian Assange behind bars

Are Humans Worth More Than Other Organisms?

Climate crisis sees rise in illegal water markets in the Middle East

Panama Canal agency warns water shortage “is not over”

From Assange to 9/11 to Supply Chain Failures: When Can You Believe Government Explanations?

Pyongyang Says It Will Send Troops to Ukraine Within a Month

Electing the Next Dictator: Ugly Truths You Won’t Hear from Trump or Biden – Global Research

Trade War Between Europe and China Is Creeping Closer – Global Research

US, UK and EU Preparing for War Against Russia. Reinstating the Draft – Global Research

America’s Dark Day – Scott Ritter Extra

Scale Up Nature

Big Banks Pass an Extreme Stress Test Including 10 Percent Unemployment – MishTalk

As Putin floats peace terms, US-Ukraine call for prolonged war

G3P: Global Public-Private Partnerships and the United Nations

Here’s Why These Troubling Trends Mean Mass Chaos is Likely Coming to the West…

Chaos is Spreading Everywhere! – by David Haggith

Where and Why Tornado Risk is Growing as Climate – and Communities – Change

How To Stay Cool Without Air Conditioning

Heatwaves and wildfires strike across US as tropical storm forms in gulf | Extreme weather | The Guardian

We’ve Hit Peak Denial. Here’s Why We Can’t Turn Away From Reality | Scientific American

Scientists “Puzzled and Concerned” – by Guy R McPherson

Our Propagandized Society Is Like A Sick Man Who Doesn’t Know He’s Sick

What Would Happen If This Event of 41 Years Ago Happened Today? – Global Research

 

Scary Stat Alert: The Government Liquidity Index

Scary Stat Alert: The Government Liquidity Index

Obscure but historically accurate crash signal

Not that we need any more scary statistics, but here’s one that might be worth watching. From the Brave browser’s AI summarizer:

Government liquidity index

The government liquidity index is a metric that measures the ease or difficulty of trading in government securities, such as U.S. Treasury bonds. It is a gauge of deviations in yields from a fair-value model, indicating the level of liquidity in the market.

Measures of liquidity in the Treasury market are near crisis levels, raising concerns about underlying fragility in the functioning of the market. This can lead to historically large daily swings in yields, making it difficult for traders to carry out trades.

Government Intervention

In response to these concerns, the U.S. Treasury has announced that it will begin regularly buying back its bonds starting May 29, for the first time in over two decades. This move is aimed at improving liquidity in the market and reducing the risk of market mayhem.

In a recent tweet, market analyst Tavi Costa explains what this means:

The liquidity index for US government securities is deteriorating significantly, now at its worst levels since the European debt crisis in 2011.

Notably, it’s already more severe than the environment during the Covid crash in 2020.

What is even more alarming today is that this is all happening while the US currently has one of the largest interest rate differentials compared to other developed economies in history, yet liquidity appears to be eroding.

This situation is setting the stage for the US to experience its own “Bank of England moment” as we approach elections.

In September 2022, UK yields saw one of the steepest increases in history after the announcement of £45 billion in unfunded tax cuts, which raised concerns over increased borrowing needs and debt sustainability.

…click on the above link to read the rest of the article…

Debt Brakes and Treaty Requirements About to Smash the EU

The EU has launched an Excessive Debt Proceeding against France. It won’t stop there.

Debt Proceedings

Please note the EU Rebukes France, Italy and Others Over Excessive Debt.

The assessments of the 27 EU states’ budgets and economies will be published by the European Commission on Wednesday, with France, Italy and Belgium among the member states to be reprimanded over their accumulated excessive new debt.

The Commission said it was satisfied that “the opening of a deficit-based excessive deficit procedure is warranted” in the case of seven countries. The group also included Hungary, Malta, Poland and Slovakia.

The EU suspended debt and deficit regulations to help countries cope with the economic fallout of the COVID-19 pandemic and Russia’s invasion of Ukraine.

The rules are now back in place and now any EU country going over debt and deficit limits run the risk of legal action.

EU’s Golden Rules

According to the reformed rules, an EU member state’s debt may not exceed 60% of gross domestic product (GDP).

Highly indebted EU countries with debt levels over 90% of GDP have to reduce their debt ratio by one percentage point annually, countries

Additionally, the general government deficit — the shortfall between government revenue and spending — must be kept below 3%.

According to the commission’s economic forecast, France is at -5.5%, Italy is at -4.4% and Belgium is at -4.4% and will breach this deficit limit in 2024.

Austria, Finland, Estonia, Hungary, Malta, Poland, Romania, and Slovakia also have deficits that are too high according to the rules. Spain is at exactly -3.0%.

Snap Elections

French President Emmanuel Macron was hammered in the European Parliamentary elections as expected in this corner, and generally elsewhere.

Winners: The Far Right

Losers: Renew Europe (Macron), and the Greens.

The response by Macron caught everyone off guard. He dissolved parliament and called for snap elections.

…click on the above to read the rest of the article…

U.S. Government Historical Debt

U.S. Government Historical Debt

Chart of the Week #7

Over the years, meeting people from all walks of life, I’ve noticed something: when you bring up the massive U.S. debt that’s starting to take over our whole economy, some just shrug and say, “Well, the U.S. has always had a ton of debt — it’s just how things are, nothing to be too surprised about.”

When I come across this line of thinking, I like to whip out the following chart. Take a look. It shows the U.S. government’s debt since 1790.

What you’ll notice right away is that government debt was pretty much nonexistent from the early days of our country until about halfway through the 20th century.

But this situation changed in the second half of the century, first gradually and then alarmingly. This happened with the expansion of federal government spending under Presidents Franklin D. Roosevelt, Lyndon B. Johnson’s, Richard Nixon. And debt just kept snowballing since.

That said, President Biden really took it to levels we hadn’t seen before.

In the years since taking office in 2021, Biden went on a trillion-dollar spending spree with stimulus projects like the American Rescue Plan, the Infrastructure Investment and Jobs Act, and the Inflation Reduction Act.

The unmistakable result of such policies is the current national debt standing at $34.8 trillion — more than a quarter-million dollars for every household — compared to “just” $27.8 trillion in 2021.

Come to think of it… “standing” may not be the best word. The U.S. government debt never stands still; it grows relentlessly with every passing moment. Here’s a link if you want to watch it go up live, but be warned, it’s quite disturbing.

U.S. Government Debt vs. GDP

U.S. Government Debt vs. GDP

Chart of the Week #8

I don’t usually do these more than once a week unless I come across something really pressing that I want to share with you. But after a reader named Laramie made an interesting comment under the chart I published earlier this week, showing U.S. government historical debt, I figured this topic needed a follow-up for more context. Here’s a snippet of what he wrote:

We know a debt level at 120% or more of GDP eventually leads to chaos in countries that do not have the world’s reserve currency.

Laramie is spot-on. Once a country reaches a certain level of debt relative to its economy, something tends to break. And usually, it’s not just one thing.

As it happens today under Biden, the U.S. government’s $34.8 trillion debt is already about 125% of America’s Gross Domestic Product (GDP). This places us in the company of nations like Venezuela, Sudan, and Lebanon on the list of Top 10 countries with the highest debt-to-GDP ratios.

None of these countries are successful, vibrant economies, or places you’d want to hang your hat in — quite the opposite. It’s just not a great club to be a part of.

And what’s really frustrating is that things haven’t always been like this in the good ol’ US of A. In fact, the only comparable period when the nation was this deep in debt relative to its economy was during World War II and its immediate aftermath. Not even the years of the Great Depression came close. Take a look at the chart below.

Just think about it — it took the mother of all emergencies, a world war no less, to bring the U.S. debt-to-GDP ratio to where it is now. If that doesn’t give you pause, I’m not sure what would.

…click on the above link to read the rest of the article…

A Most Dangerous Assumption: Mining the Future to Spend More Today

A Most Dangerous Assumption: Mining the Future to Spend More Today

What the cheerleaders are actually claiming is the process of adding zeroes to “money” is limitless, but there are limits on the utility of devaluing currency, too.

How prosperous would the world be if we hadn’t collectively borrowed and spent $315 trillion—-333% of global GDP? We all know the answer–not very prosperous at all, for production, consumption and profits would all be mere fractions of their current totals if we could not borrow money and could only spend cash on hand. Global Debt Hit $315 Trillion In Q1 2024.

All this money that’s been spent/invested has effectively been mined / extracted from future resources, labor and capital. The basic idea is that the interest that must be paid on this debt will be paid out of earnings generated by the productive use of resources, labor and capital in the future. Once the debt matures and the principle must be returned to the lender / bond purchaser, this principle must also be mined / extracted from assets available in the future.

Mining / extraction is the appropriate analogy because nothing is unlimited in the real world. Imagination–yes, it’s unlimited. Denial and delusion: yes, both are limitless. But tangible resources that can be recovered at costs the economy can bear, productive labor and capital are not limitless. If we mine the future too intensively, there won’t be enough left in the future to spend/invest at the level we enjoy today.

The fundamental assumption behind mining the future is that the pool of resources, labor and capital will continue expanding forever, effortlessly funding the interest and principle due on today’s borrowing and leaving more than enough to consume and invest in the future.

…click on the above link to read the rest of the article…

The Ideological Battle Behind the U.S. Debt Crisis

The Ideological Battle Behind the U.S. Debt Crisis

The U.S. national debt is at 34.7 trillion dollars. If you laid that many dollar bills end-to-end, it would wrap around the Earth 134,599 times. That’s enough to travel to the sun and back 17 times. Suffice it to say, we’re in a pickle.

America is slowly approaching the precipice of debt default. This is no minor dilemma. A default could cause approximately 8 million jobs to be lost. In other words, the bill would come due.

For many politicians, the debt crisis is not a pressing concern. At least not enough to take measures to fix it. The Biden administration passed a 1.2 trillion-dollar infrastructure bill in 2021, adding 256 billion dollars to the budget deficit over the next ten years. Biden has also forgiven 167 billion dollars in student loans during his tenure, which was financed through increased government spending. Despite already being one of the most indebted countries in the world, politicians continue to dig the U.S. into an even deeper hole. The problem is not simply a monetary one. There is an ideological battle underlying our descent into debt.

The ideas that have caused America’s current debt crisis were birthed during the Great Depression. In 1932, Franklin D. Roosevelt issued a series of spending measures that were intended to stimulate economic activity in what was called the “New Deal.” FDR spent over 950 billion (inflation-adjusted) dollars on the program while being touted as an economic “savior.” The deal was promoted as what released America from the bonds of the recession. In reality, it made the problem worse.

A study conducted by two UCLA economists found that the New Deal actually extended the Great Depression by seven years. By artificially increasing wages while unemployment remained rampant and below projected recovery rates, FDR’s program harmed economic health. Simply pumping money into the economy wasn’t the fix-all solution it was advertised to be.

…click on the above link to read the rest of the article…

CEO Of Russia’s Second-Largest Bank Warns: “US Is Inevitably Headed For A Serious Economic Crisis”

CEO Of Russia’s Second-Largest Bank Warns: “US Is Inevitably Headed For A Serious Economic Crisis”

Last September, we told readers that the US national debt was skyrocketing at a staggering $1 trillion every three months—roughly every 100 days.

Since then, the debt spending has gotten worse.

Out-of-control spending has delayed the US economy’s day of reckoning in this year’s presidential election cycle. But it has become very evident an economic crisis looms in the years ahead.

One River Asset Management CIO, Eric Peters, recently said, “I have a growing conviction that in the coming 2-5 years, we’re going to face a US debt sustainability crisis, sparking a major global market event.”

BofA CIO Michael Hartnett recently noted what we said previously about the unsustainable debt explosion

And now, fresh comments from Andrey Kostin, CEO of Russia’s second-largest bank, have emerged—comments that Western mainstream media dare not share with their audiences. Why is that? … Well, the Washington censorship blob wouldn’t allow it.

Russian state-owned news agency TASS cited Kostin’s interview with the Fontanka publication, who warned if it wasn’t for the dollar’s status as the world’s reserve currency, a sovereign debt crisis would’ve already been underway in the US. No matter what, he warned the US economy is on the verge of an economic crisis.

“I am thoroughly convinced that America is inevitably headed for a serious economic crisis. The amount of debt currently held by the US today has reached inconceivable, astronomical levels. And the dollar’s monopoly on the global stage is the only thing enabling the Americans to maintain such a level of debt. If the Chinese or the Arabs took their money out of the US, a complete collapse would ensue for the financial sector and the government,” he said. 

Kostin added:

…click on the above link to read the rest of the article…

Is Hyper-Inflation that Destroys a Currency a “Solution”?

Is Hyper-Inflation that Destroys a Currency a “Solution”?

This contrarian sees a strong consensus around the notion that hyper-inflation is the inevitable end-game of nation-states / central banks issuing fiat currencies, i.e. currencies that are not restrained by being pegged to tangible assets such as gold reserves. The temptation to issue (via “printing” or borrowing new currency into existence by selling sovereign bonds) more currency becomes irresistible to politicians and central bankers alike. as the means to mollify every constituency, from elites to the military to commoners dependent on state-funded bread and circuses.

This unrestrained creation of new money far in excess of the expansion of goods and services (i.e. the real economy) devalues the currency, as “all the new money chases too few goods and services.” Gresham’s law kicks in–bad money drives good money out of circulation–as precious metals, fine art, gemstones, etc. are hoarded and the depreciating currency is spent as fast as possible before its purchasing power declines even further.

The Cotillion Effect also kicks in: those closest to the spigot of new money get first dibs on converting the depreciating currency into tangible goods, leaving the non-elites to sweep up the “trickle-down” shreds left as the currency loses purchasing power daily.

The consensus holds that there is no way to stop this decay of purchasing power to near-zero, i.e. hyper-inflation, once it starts. As in a Greek tragedy, the fatal flaw of the protagonist–in this case, fiat currency–leads inevitably to its destruction.

In the real world, things having to do with money tend to occur because they benefit powerful interests. This leads us to ask of hyper-inflation: cui bono, to whose benefit? Exactly which powerful interests benefit when a currency’s purchasing power plummets to near-zero?

…click on the above link to read the rest of the article…

There’s More to China’s U.S. Debt-Dumping Rush Than Meets the Eye

There’s More to China’s U.S. Debt-Dumping Rush Than Meets the Eye

Unprintable Alternative to Debt, De-Dollarization, Not Just China, Leaving the West for the East

“Gold is money. Everything else is credit.”
~ J. P. Morgan

Earlier this week, I told you how China has accelerated its de-dollarization efforts with rapid-fire sales of U.S. debt.

The country offloaded $53.3 billion worth of U.S. Treasuries and U.S. agency bonds. This is the largest single sale of U.S. debt in its history.

But, as I explained, even U.S. allies like Belgium and Switzerland have recently dumped an impressive $20 billion and $43 billion worth of Treasuries, respectively.

If this trend keeps up, it could be a big problem for the U.S. government. That’s because about one-third of its debt, or $8 trillion, is held by foreign countries.

The Unprintable Alternative

Now, the main reason foreigners own such a large portion of U.S. debt is simple: the U.S. dollar is the world’s primary reserve currency.

Currently, central banks hold about 58% of their foreign reserves in U.S. dollars. To earn returns on all this cash, they invest it in U.S. Treasuries, which are considered the safest assets in the world.

There’s just no alternative… or is there?

Well, China certainly seems to think so.

Just take a look at the next graph showing China’s holdings of U.S. Treasuries and gold as a percentage of its foreign reserves since 2015.

The chart above shows that as China cut back on U.S. debt, it ramped up its gold purchases. This inverse relationship between China’s gold and U.S. debt holdings became really noticeable around 2018, when the trade war with the U.S. kicked off. And as I mentioned in my last essay, by 2019, China had given up its spot as the biggest holder of U.S. debt to Japan.

…click on the above link to read the rest of the article…

Olduvai IV: Courage
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Olduvai II: Exodus
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