{"id":63051,"date":"2022-07-14T06:20:31","date_gmt":"2022-07-14T11:20:31","guid":{"rendered":"https:\/\/olduvai.ca\/?p=63051"},"modified":"2022-07-14T06:20:31","modified_gmt":"2022-07-14T11:20:31","slug":"take-the-tragedy-in-sri-lanka-and-multiply-by-ten-the-fed-just-lobbed-a-financial-nuke-that-will-obliterate-the-global-economy","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=63051","title":{"rendered":"“Take The Tragedy In Sri Lanka And Multiply By Ten”: The Fed Just Lobbed A Financial Nuke That Will Obliterate The Global Economy"},"content":{"rendered":"
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“Take The Tragedy In Sri Lanka And Multiply By Ten”: The Fed Just Lobbed A Financial Nuke That Will Obliterate The Global Economy<\/a><\/h3>\n<\/header>\n
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We are living in a period of mass \u201cJonestown\u201d economic delusion. Just twenty months ago \u2013 central bankers were offering to buy nearly every junk bond known to mankind, dramatically distorting the \u201ctrue cost of capital.\u201d All the way from crypto to emerging markets \u2013\u00a0it was a moral hazard overdose<\/strong>. Everyone on earth was borrowing money at fantasy-land bond yields.<\/p>\n

Now<\/strong>,\u00a0the Fed is promising endless rate hikes and $1T of balance sheet reduction onto a planet with emerging market and Euro-zone credit markets in flames.<\/strong><\/p>\n

Listen, all I have is an economics degree from the University of Massachusetts, but after having spent the last 20 years trading bonds professionally and embarking on a 20k feet deep autopsy on the largest bank failure of all time \u2013 from my seat the current Fed agenda is sheer madness and will be outed very soon.<\/p>\n

The true cost of capital was distorted for so long, we now have hundreds of academics\u2013 clueless to the underlying serpent inside global markets. When the 6 foot seven, Paul Volcker walked the halls of the Marriner S. Eccles Building of the Federal Reserve Board in Washington,\u00a0our planet embraced about $200T LESS debt than we are staring down the barrel at today.\u00a0<\/strong>Please call out the risk management imbeciles that make any reference of \u201cPowell to Volcker.\u201d<\/p>\n

In 2021, global debt reached a record $303T, according to the Institute of International Finance, a global financial industry association. This is a FURTHER jump from record global debt in 2019 of $226T, as reported by the IMF in its Global Debt Database.\u00a0Volcker was jacking rates into a planet with about $200T LESS debt.\u00a0<\/strong>Please call out the risk management imbeciles that make any reference of Powell to Volcker.<\/p>\n

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\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

“Take The Tragedy In Sri Lanka And Multiply By Ten”: The Fed Just Lobbed A Financial Nuke That Will Obliterate The Global Economy We are living in a period of mass \u201cJonestown\u201d economic delusion. Just twenty months ago \u2013 central bankers were offering to buy nearly every junk bond known to mankind, dramatically distorting the […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[33004,195,1732,303,431,29671,534,3650],"class_list":["post-63051","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bear-traps-report","tag-debt","tag-emerging-markets","tag-fed","tag-interest-rates","tag-larry-mcdonald","tag-monetary-policy","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63051","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=63051"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63051\/revisions"}],"predecessor-version":[{"id":63052,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/63051\/revisions\/63052"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=63051"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=63051"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=63051"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}