 GDenenral:
Too funny indeed;
maybe takes a 'fat finger' to pop a really big bubble!..... ;)
Yeah, China is its own house of cards, trashy 3 trillion in non-infrastructure
supported developments, no sewers, no running water,,,,,,,,
But to Schiff's point, USD index is falling, but that is what the fed wants,
and also, interest rates must rise as someone in the US wakes up to collapsing
USD prices, and the threat against the Petro-Dollar standard,
then the stock and mortgage markets, faced with the 'fat finger,' will have to sell off.
GD asks a good question: "what's the difference who the debt is owned by?"
If the debt is foreign owned as currency reserves, then if they collude, they can
eventually force the US to stop the fall in the value of the USD or threaten
a total and catastrophic dump that would estroy the US USD status the current
world reserve currency; the bubble is international and the 'fat finger' may be Chinese
or a combination of BRICs countries.....so outside US control.
If the majority of US debt is self contained, i.e. as US bank and mortgage debt
via sequestered cash trades for bonds and asset paper, the US Fed can contain the bubble
within its own jurisdiction, then fear of self-devastation would prevent home jurisdictions
from dumping their own cash only to result in the destruction of their own underlying value.
See, the genius of the Fed Reserve being the big bull buying it's own bonds for almost 6 years now
is that they have successfully diluted the over all value of the foreign USD currency reserves.
China's USD bond holdings have taken a huge dilutionary hit....and they know it....
and who screams about China manipulating the value of the Renminbi and Yuan?
Donald Trump....;)
Those are the extreme scenarios, and the fact is US is vulnerable on both fronts:
as the international 'petro-dollar' and reserve currency held by many countries, and internally in
the US by banks and other institutions as fractional reserve deposits.
Maybe we should call the Fed and its bond and mortgage Ponzi schemes
"too fat to fail".....too fat to be popped......too Ponzi to Pop.....
yeah, it takes a really big fat finger to pop a really big fat fed bubble.....
-Plat
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