This is absolutely mind-boggling!
The U.S. government has normalized running a $2 trillion deficit.
They better hope there's never an economic downturn, or things could get catastrophic… Oh wait… pic.twitter.com/xZjW4JZkKm
— The Cytadel (@thecytadel) September 12, 2024
Gold rising with rising US real rates conveys a simple message that has surprised many US investors but which is very familiar to EM investors:
"Buy gold because with debt & deficits this high, positive real rates make the US fiscal position unsustainable without money printing" https://t.co/ZThWEdBjG3
— Luke Gromen (@LukeGromen) September 17, 2024
Daniel Lacalle: An Unprecedented Monetary Destruction Is Coming
“Central banks are already suffering significant losses as a result of the falling value of the bonds they hold on their balance sheets. The European Central Bank, the U.S. Federal Reserve, the Bank of England, the Swiss National Bank, and the Australian central bank all now face possible losses of more than $1 trillion altogether.”
“If central banks start issuing digital currencies, the level of purchasing power destruction of currencies seen in the past fifty years will be exceedingly small compared with what can occur with unbridled central bank control.”