The New Liberal World Order

Don’t be fooled. It’s not Putin crashing the economy and causing inflation. It’s not the pandemic. It’s not climate change. It’s the response to all these things. At a very basic level it’s money printing.

The large debt puts central bankers in a choice, do you pay it back with hard money, or do you pay it back with printed devalued money.

Three big things that are changing now:

  • the amount of debt and money creation;

  • when there’s a large wealth and values gap, at the same time as you have a financial problem, then you get populism, populism of the left and populism of the right…and their positions harden…there are no compromises…maybe in 2024, neither side would accept losing…maybe you don’t follow the rulings of the Supreme Court…These things have not happened in our lifetime but have happened many times in history.

  • the rise of a great power (China) to challenge the existing great power.

This is nothing new, the same thing happens over and over again. New excuses are made each time but the real cause doesn’t change.

But don’t blame the Federal Reserve says the Chairman of the Federal Reserve. “There wasn’t something wrong with our models, it wasn’t the models at all.” Everyone was supposed to get vaccinated, and they didn’t, that must be the problem.

The US took 215 years to reach $7 trillion of debt but then managed to add another $7 trillion within 2 years. (It’s not just the US, it’s the same throughout the West.)

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.And the result?

  • 58% of Americans are living pay cheque (check) to pay cheque (check!), including 36% earning $250K+.

  • The stock market has had its worse first half year since the 1970s.

  • Mortgage demand has plummeted to a 22 year low.

  • Americans are borrowing against their houses at the highest level since the 2008 financial crash.

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  • Government bonds are looking like they will have their worst year since 1865.

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  • Germany’s foreign trade surplus has crashed into negative figures within the space of a few months.

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Build Back Better is dead. Long live the Liberal, Rules-Based, World Order.

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