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Strategies & Market Trends : Humble1 and Swing Trading Friends

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To: humble1 who wrote (40214)9/19/2024 2:18:04 PM
From: Sun Tzu2 Recommendations

Recommended By
humble1
rdkflorida2

   of 41057
 
Rates will collapse around the world but for a very different reason.
The size of public debt around the world (not just the US) is too big to allow high interest rates. Last year the increase in the interest rate caused an *additional* one trillion dollar government deficit. This number is too huge to be comprehensible.

As I've explained elsewhere, the Fed has no choice but to play a shell game and a ruse: Seem to care about inflation enough to not spook the bond market, while being dovish enough to manage the increase in government debt.

Eventually the game will be called and the Fed will have to resort to yield curve control by increasingly buying the government debt. This is essentially printing money and devaluing currency to allow the government to inflate its way out of debt.

Other nations are not blind to this, which is why their central banks are buying gold and their trades are increasingly only notionally denominated in USD while in fact using other things in the background.
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