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I sticking my head out and predicting a likely banking crisis,...

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    I sticking my head out and predicting a likely banking crisis, GFC and stock market crash.

    The snapshot below is from the US treasury auction website (see here) . It shows another bond auction disaster with the US 20y bond selling for 4.818% yield - which is a massive premium to the expected 4.5%. The US has at least another 9 trillion worth of debt to sell in 2024 and it appears all the scheduled US bond auctions have all been pulled. Why? => because bonds have become unsellable. There is simply not enough money available and too much risk of long term inflation happening with the US economy being so strong.

    There is an opinion on the internet that the fed will solve this debt crisis by simply printing money or by changing the bank cash rules to make more money available for buying gov bonds. But they can't do that without a crisis or a recession because such a move in a strong economy will cause inflation to spike and the fed will have to hike rates again and be in an even worse spot than now.

    So, there is only one solution and that is to have a crisis and they have to have it now because there are too many problems building up in the global financial system - which is caused mainly by the strong US dollar.

    How will this play out? First a bank goes broke and the market panics. Then a few more banks go broke and the market panics more. Then the fed changes the bank cash rules, and does one or two rate cuts, and ends QT, and starts buying bonds again (somehow? not QE) - and everything is rosy again in time for the election.

    Will another crisis happen after the election? Maybe? They all want to get back to QE no matter what.

    https://hotcopper.com.au/data/attachments/6126/6126989-43ca58142b2203e0a8ebae65cbc5af9e.jpg

 
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