Something I've been postulating on in the usual autistic manner. How will bonds and treasuries be handled during the collapse. My understanding, which admittedly isn't the greatest when it comes to ultra-scale finance, is that the majority of Billion Dollar+ Companies will keep most of their "cash" in the form of T-Bills and Federal/Municipal bonds.
For all intents and purposes, Government issued bonds are equivalent to cash once you reach macro-scale finance for giant corporations. They're easily convertible into actual cash on demand, and even give a small amount of interest that's 100% tax free in the interim. So it all makes sense, given it would be next to impossible to safely store billions of dollars in cash, even using a cash management service like Intrafi, the maximum you could store using FDIC coverage would be $750 Million.
So here's my question for those autists and anons more knowledgeable in this realm. What's going to happen to the bond market during and after the financial collapse? I mean, we can't just let trillions of dollars in capital evaporate. That's the money that's used to pay people's wages for the majority of large and medium sized businesses.
I know I know. "I don't care what happens to (Insert large corporation)". And I get that sentiment. BUT, I do care about the people who work for said large corporations, and all the smaller businesses that rely on them. How will the farmers who provide the produce for say, walmart, get paid if all of walmart's liquid capital is poofed out of existence overnight. How will all the blue collar CNC Machine shop workers that make precision parts for GM, Ford, and Chrysler get paid if the big three don't have the capital to pay for their machining contracts? Etc. etc.
And that's not even touching the fact that the majority of banks in the USA actually take your money and invest them into US bonds and Treasuries. That's where the majority of you money you put into a bank goes, not to loans, or a vault. The overwhelming majority is invested in US treasuries and bonds as a "safe" investment. So this would also mean literally everyone in the country would essentially lose their money and have no means of recovering it.
My limited understanding from my business classes back in college, is that in the "unlikely scenario" of a default, the US Government may default on all FOREIGN debt, but may never default on debt owed to US Citizens. Meaning if push come to shove, we could dump all of our foreign debt, but any bonds or Treasuries owned by a US citizen or company will still have to be honored.
But when I tried confirming this, I found nothing to confirm that, which has me thinking my Finance and Business professors lied to us (shocker). And when I try to ask this question on any other forum I get the typical normie response of "It's impossible, the US can't default since its' the safest investment in the world". Even when I try to put forth a hypothetical question on the topic, it's apparently just so unfathomable to these people that it would happen.
Which led to me asking my fellow financial nerd anons and autists. What's your theory on this? Not something I've ever seen brought up before, and figured it was worth discussing.
EDIT: Since people keep mentioning silver and gold, let me point this out. Gold and Silver will be USELESS in this scenario. No one can buy your gold or silver if no one has money for it, and you can't trade it for non existent groceries and supplies because the producers aren't being paid. In this scenario all forms of "traditional currency" are essentially worthless, because we've devolved into a "Mad Max" type scenario since no one has any money and are desperate to meet their basic needs. The only things of value would be food, medical supplies, water, ammo, and weapons. Your gold and silver won't do you much good when no one cares about it because they're desperate for food and have more guns and ammo than you.
Hence why I believe there HAS to be a solution to this scenario, and why I'm asking for theories on what that solution may be.
it's gone. Just like Everbank bonds. USA will file bankruptcy in a Swiss court or something to avoid having to pay bondholders.
It's ugly, get your wealth into physical silver and gold
See that doesn't set well with me. That's the type of thing that will cause a mass panic, leading a Mad Max Scenario. If people think they've literally lost everything, then there's no incentive to not devolve into tribalism. There has to be SOME kind of order to things to keep it peaceful and calm, otherwise we just end up in the exact scenario the cabal wants us to be in.
Besides, in this scenario, your physical gold and silver aren't going to be worth anything. Not like you can go to the local grocery store with a silver ingot and pay for your groceries, especially if there's not groceries coming in because the farmers aren't being paid. And there's the fact that roaming bands of bandits would probably just rob you for supplies while you're in public as well.
So yeah, in this scenario Gold and Silver are just as, if not more worthless than the bonds and cash. The only things of value would be food, water, medical supplies, and weapons/ammo.
At a minimum the US Federal Reserve note HAS to lose value, whether it's 50% or 100% or some other number. That's just basic math. The out year obligations for Social Security, medicare, military retirements, etc. etc. are over 200 TRILLION. That's just jacks for openers. The system relies on new loans for money to be conjured out of thin air and put into the system, people are indebted up to their ears. Not everyone, but a vast majority. I could go on and on, but you get the picture. There is no rule that says things have to stay "peaceful and calm" and gold/silver are not for use during a mad max scenario, they are for your extra purchasing power to be stored ABOVE AND BEYOND what you feel you need to have to get through some unknown timeframe. It could be a day, a week, a year, no one knows. But you need to have preps stored that you noted in your remark. I don't know what is going to happen, but I would be prepared for the FRN's to lose a LOT of purchasing power in the next year or so.
I personally believe the opposite is true. It doesn't HAVE to lose value, we could simply just default on our debt and convert to a "new" system of asset backed currency. Don't get me wrong, I do believe there will be a rather sizable loss of purchasing power (there already has been), but everything going to zero just isn't an option in my mind.
And yes, things DO have to be "peaceful and calm". If people start shooting each other in the streets over basic necessities, then it's the exact same scenario as what the cabal wants.
My personal theory, is that we'll probably see a stock market crash worse than the great depression, which will drag everything else down with it (like currency losing 50% of it's value), which will result in us converting into an asset backed currency since gold and silver will be worth infinitely more without all the artificial pressure by banks, hedge funds, governments, etc. to keep the value down (it's generally accepted that silver SHOULD be worth between $5K and $50K and Gold should be worth between $50K and $100K based on inflation alone, but various cabal financial ogranizations collude to fix the prices and keep them down to the level they were at in the 80s for the most part.)
Assuming the generally agreed upon values are roughly true, then our current US Gold Reserves would be more enough to cover every dollar in circulation. And even more so if we retire a large portion of the currency to increase the value to pre central bank levels.
Of course that's just my theory, but it makes the most sense to me with the info we have.
Losing "value" and losing "purchasing power" is exactly the same thing. I didn't state it would lose 100% although I stated that it "could". My thoughts are the same as yours with regard to silver/gold. My statement was that things DON'T have to stay peaceful and calm, just because that's the way things turn out the best, although I hope you are correct. Anything can happen, but I'm hoping for the best as you are. But my initial statement is true, the FRN "HAS" to lose value, I didn't say all of it's value and defaulting on debt will guarantee a "loss" of value, just not necessarily 100%. In fact I doubt it would be 100%. I don't think we have much of a difference of opinion, perhaps just an interpretation issue.