As we kickoff the new year, this is the real reason why 2018 will be an absolutely terrifying year.
(King World News) – Egon von Greyerz: “Welcome to 2018 – a year that will be the culmination of at least 105 years of mismanagement of the Western financial system by governments, central bankers and the elite…
2018 will be a year of major volatility in many markets. Stocks are now in a melt-up phase, and before the major bear markets start in virtually all countries around the world, we are likely to see the final exhaustion moves which could be substantial. The year will also be marked by inflation increasing a lot faster than expected. This will include higher interest rates, much higher commodity prices, such as food, oil and a falling dollar. And many base metals will strengthen. Precious metals finished the 2-3 year correction (depending on the base Currency) in 2015 and are now resuming the move to new highs and eventually a lot higher. More on this later.
For a century, a reckless elite has controlled the system for their own personal gain and thus accumulated massive wealth. Ordinary people have been totally cheated into believing that they have benefitted by having all the material things that most of them can’t afford – be it a house, car, computer or iPhone. All on credit of course. Whilst the elite owns most of the assets, ordinary people own the debt. Not just their own debt but also the public debt burden which irresponsible governments have built up, including unfunded liabilities such as pension and medical care. And when the financial system fails, ordinary people will suffer the most.
We have seen a century of debt buildup from virtually zero to $240 trillion. Global debt has doubled since the beginning of the Great Financial Crisis in 2006. This has led to asset bubbles and overvaluations never seen before in history. If unfunded liabilities and derivatives are included, the total burden amounts to $2 Quadrillion.
That is the enormous Sisyphean task that the world will have to struggle with in coming years. Although central banks and the elite seem clueless, they are clearly aware of the gigantic size of the problem.
We know that these liabilities can never be settled. What happened in 2006-9 was only a rehearsal. In the last minute, central banks orchestrated a massive rescue program which included interest rate reduction, money printing, guarantees, liquidity injections plus allowing banks to value toxic debt at maturity instead of market. These measures temporarily postponed the inevitable collapse. They are unlikely to work next time but since the central banks have few other options left, they will try the same things again. But next time they will fail…..more here