The Real Crash Is Here

[Nom De Plume]

March 19, 2020 by SchiffGold 0 1
On Wednesday, March, 18, Peter Schiff did a live episode of his podcast and took questions for over four hours.
In a nutshell, Peter made the case that the real crash is here. He covered a wide range of topics relating to the ongoing and ever-evolving coronavirus crisis.

As far as the mainstream narrative out there, Peter said, “Everybody has lost their minds.”
This is really the most idiotic thing I’ve ever seen. And, you know, the economy is about to implode. That much is pretty sure.”

Peter is not talking about the steps being taken to hunker down in an effort to slow the spread of coronavirus. He’s talking about what everybody is saying the government needs to do to address the economic downturn

Peter said it took longer than he thought it would to get to this point. But here we are.

That bubble has now popped. Believe me. I had no idea that the pin to pop this bubble would be the coronavirus. … This pin has pricked the biggest bubble that the Federal Reserve has ever inflated. And now the air is coming out. And at this point, it doesn’t even matter what happens to that pin. …
The damage is already done. The cat’s out of this bag. This bubble has popped. And there is a lot of air that’s going to come out of it.”

One example of the craziness is the call for “helicopter money.” The term refers to giving money directly to individuals as if dropping cash on everybody out of a helicopter. As Peter pointed out, when Milton Friedman coined the term, it was a joke.
He was using it as an example of what not to do, about why Keynesian monetary stimulus doesn’t work. He said it’s a crazy, stupid idea. It’s like dropping money from helicopters. Because dropping money from helicopters doesn’t do anything. It’s just inflation. It just makes prices go up.”
We don’t need more money. We need more stuff.

Adding money doesn’t add anything of value. It’s just paper.”

Donald Trump has been comparing the coronavirus crisis to World War II. Peter made the point that in World War II, there weren’t any corporate bailouts.
Not only did people not get bailout checks from the government; the government tripled taxes.”

Last week, Peter asked the question: has the bond bubble just been pricked? It appears that it has. Bond prices are collapsing almost as fast as stocks. Now people are piling into the dollar.

The US dollar isn’t a safe-haven either. And the people who are buying US dollars are about to blow up and watch their purchasing power evaporate. Because we all assume the Fed can create as much money as it wants. That it can create tens of trillions of dollars. Remember, we’re bailing out everybody. Bailing out the airlines. Bailing out the hotels. Bailing out the manufacturers. Bailing out the plane manufacturers. The automobile manufacturers. Bailing out the individual workers. This is bailout nation. We’re bailing out everybody. How can we bail out everybody? Who’s going to do the bailing? The government doesn’t have any money. It only has money that it takes from the people.”

Peter said the real crash that’s coming is a dollar crisis.

All the money the Fed is printing isn’t going to have value. It isn’t going to buy anything. Prices are going to skyrocket. And in fact, this coronavirus is accelerating that process because the coronavirus is reducing the supply of goods available to buy.”

This is the perfect storm for price inflation. We’ll have more money chasing fewer actual goods.
People are advocating the same monetary policies that have destroyed every country that has ever tried it.”

https://schiffgold.com/videos/the-real-crash-is-here/

[Black Orchid]

Everyone's either a critic or an expert in times of crisis

[Nom De Plume]

Everyone's either a critic or an expert in times of crisis

You should goggle Peter Schiff. He was the first warn of the GFC. He knew that the bond market would crash as it has... He's been warning of this for quite some time.

Meanwhile, I need to learn how to create a veggie garden... turn my black thumb into a green one... I hate gardening, but I hate hyperinflation more!

[Texan]

Everyone's either a critic or an expert in times of crisis

You should goggle Peter Schiff. He was the first warn of the GFC. He knew that the bond market would crash as it has... He's been warning of this for quite some time.

Meanwhile, I need to learn how to create a veggie garden... turn my black thumb into a green one... I hate gardening, but I hate hyperinflation more!

I'm with you. I have a friend who has been gardening in a green house all Winter. He travels like me and can't be in his garden every day. He has an automated watering system with a Miracle Grow drip to nourish his plants. I may go check out his garden soon. In the meantime, I'll trade eggs for fresh veggies. My father in law always kept us in fresh veggies until Alzheimers hit him at 85. I'm going to have to step up my game.

My truck will be paid off next month and my home will be paid off in about 5 years. It's a good time to stay out of debt and limit dependency.

[billy the kid]

Jim Rickards has been talking about this for years...
He even went as far as saying that the main reason for the GFC was the abolition
of the Glass Steagall legislation by Clinton....long story....
He suggested that the next economic collapse would make the GFC look like a teddy bears
picnic as the "everything bubble" collapsed...
The worldwide economic reset is upon us.
I thought it would be last year...the US Fed saved the day by bailing out the Repo gig....
Not this time....
We once thought the elephant in the room was the possibility of war in the ME...
That's still a possibility...
The corona virus has just occurred earlier....
Im no expert....I just parrot what I read (and believe)…..
For those interested...I know non de plume reads Zero Hedge....I think that a reference to that
source should be compulsory reading for all....
Wait for negative interest rates now and an Australian Bank to collapse.....
I wish everyone the very best for the troubled times ahead....
As Kenny Rogers once sang...…."I think youre (the world) out of aces...…"

[Nom De Plume]

The coronavirus' economic fallout has its own momentum as RBA makes extraordinary intervention

The Reserve Bank is trying to stop the financial system melting down. It's also warning us to brace for impact.

https://www.abc.net.au/news/2020-03-20/ ... n=business

Has the coronavirus pandemic revealed the Reserve Bank has lost control of the economy?

In what is shaping up to be an even more severe rerun of the events of 2008, credit markets have completely seized. Think of the shelves in your local supermarket and transpose that to money markets.
Cash supplies have evaporated, money is being hoarded and market interest rates — the price of cash — are soaring.

https://www.abc.net.au/news/2020-03-19/ ... n=business

[Nom De Plume]

Confirmed: Fed Bailed Out Hedge Funds Facing Basis Trade Disaster

Back in December, when the world was still confused about what exactly happened before (and after) the September repocalypse - which has since exploded thousand-fold resulting in the Fed now doing daily $1 Trillion repo operations - we said that in addition to the implicit bailout of JPM (which we described here first, and subsequently others), by restarting its repo operations the Fed was also bailing out dozens of hedge funds engaging in highly levered trades involving a relative value compression trade in the Treasury cash/swap basis... almost identical to what LTCM was doing ahead of its 1998 bailout, which is also why we titled the article "The Fed Was Suddenly Facing Multiple LTCMs."

In a nutshell, the article explained why and how the return of the Fed's repo ops was nothing more than the Fed preemptively bailing out all those hedge funds that would have imploded had basis trades gone haywire. Below is a key excerpt from that post:

One increasingly popular hedge fund strategy involves buying US Treasuries while selling equivalent derivatives contracts, such as interest rate futures, and pocketing the arb, or difference in price between the two. While on its own this trade is not very profitable, given the close relationship in price between the two sides of the trade. But as LTCM knows too well, that's what leverage is for. Lots and lots and lots of leverage.

Needless to say, as always when this website presents something the mainstream press hasn't even considered, our explanation of what really happen ahead and during the September repocalypse was met with the traditional mockery and derision by the financial "intelligentsia."

The [hedge funds] use borrowed money from the repurchase market for the popular basis trade, which exploits price differences between cash Treasuries and futures. Though individual firms’ borrowing is a closely guarded metric, people familiar with the transactions said some of them levered up as much as 50 times their own wagers. Leveraged funds’ exposure to the basis strategy could be as much as $650 billion, JPMorgan Chase & Co. strategists said.

https://www.zerohedge.com/markets/confi ... e-disaster

So, in basic terms, Hegde Funds, because of their irresponsible behaviour, have been deemed 'too big to fail' and in need of bail-outs, which the Trump govt has committed to.

[billy the kid]

Confirmed: Fed Bailed Out Hedge Funds Facing Basis Trade Disaster

Back in December, when the world was still confused about what exactly happened before (and after) the September repocalypse - which has since exploded thousand-fold resulting in the Fed now doing daily $1 Trillion repo operations - we said that in addition to the implicit bailout of JPM (which we described here first, and subsequently others), by restarting its repo operations the Fed was also bailing out dozens of hedge funds engaging in highly levered trades involving a relative value compression trade in the Treasury cash/swap basis... almost identical to what LTCM was doing ahead of its 1998 bailout, which is also why we titled the article "The Fed Was Suddenly Facing Multiple LTCMs."

In a nutshell, the article explained why and how the return of the Fed's repo ops was nothing more than the Fed preemptively bailing out all those hedge funds that would have imploded had basis trades gone haywire. Below is a key excerpt from that post:

One increasingly popular hedge fund strategy involves buying US Treasuries while selling equivalent derivatives contracts, such as interest rate futures, and pocketing the arb, or difference in price between the two. While on its own this trade is not very profitable, given the close relationship in price between the two sides of the trade. But as LTCM knows too well, that's what leverage is for. Lots and lots and lots of leverage.

Needless to say, as always when this website presents something the mainstream press hasn't even considered, our explanation of what really happen ahead and during the September repocalypse was met with the traditional mockery and derision by the financial "intelligentsia."

The [hedge funds] use borrowed money from the repurchase market for the popular basis trade, which exploits price differences between cash Treasuries and futures. Though individual firms’ borrowing is a closely guarded metric, people familiar with the transactions said some of them levered up as much as 50 times their own wagers. Leveraged funds’ exposure to the basis strategy could be as much as $650 billion, JPMorgan Chase & Co. strategists said.

https://www.zerohedge.com/markets/confi ... e-disaster

So, in basic terms, Hegde Funds, because of their irresponsible behaviour, have been deemed 'too big to fail' and in need of bail-outs, which the Trump govt has committed to.

Be interesting to see amid the hysteria of the covid 19 virus if/when the grubberment will sneak through
their cash ban legislation...maybe when there is only a handful of grubs in the house like there was when Hockey
snuck through his bail in legislation....
Went to the Bank the other day to withdraw X dollars...noticed a line of about 6 people all wanting
to do the same..a couple of punters were moaning about not being able to withdraw what they wanted...
They were told in no uncertain terms that the bank would give them a call next week when the funds may/may not be available
(of course they wont be...they'll just tell them that the bank can only give them threepence…..)
....interesting to hear one bank official babbling on about how the grubberment guarantees all deposits
under $250K...the punter shot that down pretty quick...…I smiled to myself...he must have been reading my mail...
Cheers mate....

[Outlaw Yogi]

Meanwhile, I need to learn how to create a veggie garden... turn my black thumb into a green one... I hate gardening, but I hate hyperinflation more!

I've been growing (orange) sweet potato/yams for quite a while ... the advantage to them is you can snap one in half, put a piece back on the shelf and it doesn't go off/rot like pumpkin or potato.

Pumpkins are easy to grow if you've got acid/mulched soil ... they need a bit of water and like semi shade ... keep possum away during flowering - possums steal the flowers.

Zucchini/squash don't have any real flavour but grow quick. They're a bit thirsty, but once planted you'll get fruit in 6 weeks for roughly 6 weeks.

[Texan]

Meanwhile, I need to learn how to create a veggie garden... turn my black thumb into a green one... I hate gardening, but I hate hyperinflation more!

I've been growing (orange) sweet potato/yams for quite a while ... the advantage to them is you can snap one in half, put a piece back on the shelf and it doesn't go off/rot like pumpkin or potato.

Pumpkins are easy to grow if you've got acid/mulched soil ... they need a bit of water and like semi shade ... keep possum away during flowering - possums steal the flowers.

Zucchini/squash don't have any real flavour but grow quick. They're a bit thirsty, but once planted you'll get fruit in 6 weeks for roughly 6 weeks.

I love squash casserole. My wife adds butter, cheese, eggs, onions, and Rotel tomatoes with peppers. Mmmmmm, mmmmmmm!