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Fed Trying to Stop Global Economic Contagion – Martin Armstrong

Fed Trying to Stop Global Economic Contagion – Martin Armstrong

Legendary geopolitical and financial analyst Martin Armstrong says, “The Fed is trapped. If it stops (injecting money into the repo market by billions of dollars daily), interest rates will rise.”

Armstrong goes on to explain, “The Bank of Japan came out and said we’re going to buy government bonds unlimited. They, too, are trying to prevent interest rates from rising. . . . The ECB cannot afford rates to go up. . . . This is a global contagion that’s developing, and it’s pretty serious. The rise in interest rates has tremendous implications all the way around the globe. . . . Interest rates are rising because there is increased risk – period.”

The big risk, according to Armstrong, is global governments, including the U.S. Armstrong says, “You have to understand, at some point in time, capital begins to figure out who is the greatest risk, and the risk is government. At that stage in the game, when that point is reached, then you have shifts. The capital will move from public types of investments, such as government bonds and things of that nature, and then will move into the private sector. That’s equities, and that can be gold and real estate in different places. You try to go to tangible assets.”

So, what could go wrong with the Fed trapped in the repo market and cannot stop liquefying bad debt? Armstrong says, “What can go wrong is that they lose the game. They are doing this to try to prevent interest rates from rising. If they did not do this, the short term rate would be up dramatically.”

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Economic Contagion? Central Banks Are The Real Culprit

Economic Contagion? Central Banks Are The Real Culprit

The mainstream news has been awash lately in talk over the danger of economic “contagion,” primarily due to lack of dollar liquidity in emerging markets. This lack of liquidity is being pegged as a trigger for instability in stocks, bonds and forex markets around the world, and this time around it is the nation of Turkey that is being called a potential trigger for a fiscal domino effect spreading through multiple countries.

We have heard talk of “contagion” before. Not long ago, Italy’s political shift toward a supposedly populist government led to fears of debt contagion within the European Union; this is still a valid concern, just not for the reasons the mainstream financial media usually presents.

The issue of contagion must be examined through a different set of parameters besides those shoved in our faces by the financial media. In their world, everything is a matter of unpredictable cause and effect; everything is random and coincidental. Everything is chaos waiting to happen, and when crisis does strike, all can be blamed on a set of unrelated but interconnected scapegoats.

They will claim it was the “populists,” conservatives, conservative philosophy or the notion of national sovereignty. Or they will blame it on even more abstract concepts of “human greed” and “individual selfishness.”

These excuses for unstable systems and disasters stem from a propaganda ploy developed by DARPA called “Linchpin Theory.” It is the widely promoted idea that human systems collapse “naturally” when they become “too complex,” and all it takes to start this collapse in motion is a single well placed “linchpin” pulled at the right moment. In other words, DARPA wants you to believe that there is no such thing as organized conspiracy and that all disasters are caused by chance.

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The U.S. And EU Will Collapse Regardless Of Economic ‘Contagion’

The U.S. And EU Will Collapse Regardless Of Economic ‘Contagion’

In order to understand what is really going on around the globe in terms of the collapsing economy, we must set aside false mainstream versions of reality. When it comes to the EU and its current fiscal turmoil, it is very important to, in some respects, ignore Greece entirely. That’s right; forget about all the supposed drama surrounding Greek debt obligations. Will they find a way to pay creditors? Will they default? Will they make a deal with Russia and the BRICS? Will there be last-minute concessions to save the system? It doesn’t matter. It’s all a soap opera, an elaborate Kabuki theater run by international financiers and globalists.

It is most important to remember the fundamentals. Greece will default on its debts. Period. There is no way around it. Maybe Greece makes a deal today, maybe it makes a deal tomorrow; but eventually, the country’s ability to stretch out its resources in order to meet its exponential liabilities will end. It is inevitable, and no last-minute “deal” is going to change the math at the core of it all.

Why are so many economists so worried about a little country like Greece? It’s all due to a great lie: a dishonest narrative being perpetuated by the establishment that if Greece falls, defaults or leaves the EU, this could trigger a domino effect of other nations hitting a debt wall and following suit. The lie embedded in this narrative is the claim that Greece will cause a “contagion” through the act of default.  Let’s be clear – there is no contagion. Multiple countries within the EU have developed their own debt problems in spite of Greece over the past couple of decades, not because of Greece. Each of these countries, from Italy, to Spain, to Portugal, etc. has its OWN sovereign debt disasters to deal with caused by its own fiscal irresponsibility. The only legitimate reason for a so-called contagion is the fact that these countries have been forced into socialist interdependency through the EU structure.

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