As suggested by someone on my last post
"How I think the next Great Depression might start" https://greatawakening.win/p/17rSsfoV8B/heres-how-i-think-the-next-great/
I'm posting up economic news of what I've seen this week. Feel free to add anything I may have missed.
SUMMARY OF BANK DEBT:
From what I know banks currently have about:
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900 Billion in FHLB loans (mostly 1 yr loans, haven't been able to verify, good public FHLB link appreciated!) https://twitter.com/FinanceLancelot/status/1712678734300426683
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110 Billion in Federal Reserve Bank Term Lending Program Loans (1 yr loan, have verified) https://fred.stlouisfed.org/series/H41RESPPALDKNWW)
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1.2 Trillion in Brokered Deposits (borrowing money from other banks) https://archive.ph/c5CYw
Banks don't make any physically valuable thing, banks make money from lending and getting interest from other people who do make physically valuable things. So now let's look at the peoples debt...
THE PEOPLES DEBT:
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$1 trillion in credit card debt. https://fred.stlouisfed.org/series/CCLACBW027SBOG
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$1.5 Trillion in Auto Loans https://fred.stlouisfed.org/series/MVLOAS
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1.76 Trillion in Student Loan Debt https://fred.stlouisfed.org/series/SLOAS
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$19 trillion total household debt. https://fred.stlouisfed.org/series/CMDEBT/
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$3.26 Trillion in state and local government debt https://fred.stlouisfed.org/series/SLGSDODNS
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$33.6 trillion national debt. https://www.usdebtclock.org/
Deposits in Commercial Banks are decreasing. This is by far the largest and longest decrease ever since being reported in 1973 according to the St Louis Federal Reserve. Fractional Reserve Banking doesn't work the other way.
https://fred.stlouisfed.org/series/DPSACBM027NBOG
FEDERAL RESERVES BANK TERM LENDING PROGRAM LASTS 1 YEAR FROM MARCH 2023, LOANS ARE INCREASING, NOT BEING PAID OFF
Federal Reserve Emergency Bank Term Funding Program created in March after the Silicon Valley Bank Crisis ends on March 11, 2024. It is useful because it allows banks to lends Treasury Bonds at 100% initial value instead of the below 70% value the bonds are currently trading at now.
FEDERAL RESERVE - Bank Term Funding Frequently Asked Questions https://www.federalreserve.gov/financial-stability/files/bank-term-funding-program-faqs.pdf
(Pg 4/9) A5. How long will the program be in effect? Advances from the program can be requested until March 11, 2024
Another interesting point is D2 (Pg 7/9) At what rate will advance under the program be extended?
A bank taking their Treasury Bonds or collateral can hand it as collateral to the Fed for 100 cents on the dollar instead of the market price right now which may be 70 cents on the dollar or less. The Fed charges a 1 Year Overnight Index Swap (OIS) the current rate that the advance was made + 10 Basis points (+0.1%)
Current rate found here. Its 5.5% today
https://www.frbdiscountwindow.org/
Banks will only lend to other banks who give up "good quality collateral". A lot of these repo transactions are collateralized with Mortgage Backed Securities (MBS). MBS are currently the shittiest "good quality" collateral for loans.
We Need To Discuss The New Repo Market Data ASAP | Eurodollar University
https://www.youtube.com/watch?v=tiLIOfqFr5c
12:40 June 2022 Increase of MBS collateral in Tri Party Repo while decrease in Treasury Collateral reported by NY Federal Reserve. 540billion June 2022 to 818 Billion in September 2023
17:31: 📊 The usage of US Treasury collateral in GCF repo has significantly decreased while the usage of agency MBS collateral has increased, raising questions about the shift in collateral quality.
Percentage of subprime auto borrowers 60+ days past due on loans hits a% record 6.1% in September 2023.
https://twitter.com/KobeissiLetter/status/1715730939911786714
This is the highest delinquency rate of all time, even above the 6.0% peak in 1994 and 5.0% in 2008.
The return of student loan payments has added pressure to many of these borrowers.
Average student loan payments are at $500/month and the average new car payment is at $740/month.
This means just to buy a car and pay off your student loans, the average American is spending $1,240/month.
Rising wave of property defaults threatens US banks
https://www.telegraph.co.uk/business/2023/10/27/rising-wave-property-defaults-threatens-us-banks/
Vulnerable lenders are being squeezed on all sides as debt-laden commercial real estate sector succumbs to hybrid working
“Office blocks purchased with debt remain half empty, 18 months after the end of the pandemic.…
https://twitter.com/ProdigalThe3rd/status/1717929991566946644
EDIT:
ST LOUIS FEDERAL RESERVE - Delinquency Rate on Credit Card Loans, Banks Not Among the 100 Largest in Size by Assets is at 7.51% - The highest ever recorded!
https://fred.stlouisfed.org/series/DRCCLOBS
Recent Spikes in Gun Ammo Prices
All Rifle Ammo
- 5.45x39 HUGE SPIKE JUMP
- 5.56 NATO Large Spike
- 223 Rem spike up
- 7.62x39 spike up
The US federal budget deficit effectively doubled this year
https://www.morningbrew.com/daily/stories/2023/10/22/deficit
Year over year increase effectively doubled from $1 trillion in 2022 to $2 trillion in 2023.
🇺🇸 US Senator Cynthia Lummis asks the Department of Justice to criminally charge #Binance & Tether.
https://twitter.com/WatcherGuru/status/1717592886538121461
With the Japanese Yen now above 150 Yen/Dollar, this signals the end of the extremely profitable Carry Trade. Here is a thread about the Japanese Carry Trade
Part 1: $JPY Carry Trade - The Biggest Financial Ticking Time Bomb Of All?
https://twitter.com/DarioCpx/status/1691094524368404481
Part 2: the total amount outstanding lent overseas by Japanese Financial Institutions was equivalent to a mind-boggling 144,492,600,000,000 $JPY
And that's only one part of the story. The second part is called "Cross Currency Swap"...
https://twitter.com/DarioCpx/status/1717725925125812613
Dr St. Onge Weekly Economic News Report
Episode 27 of the Podcast is live! 🥳
- "Soft Landing" calls precede every Recession
- World War 3 but Stocks are Up
- Biden: We can Afford 2 Wars
- Prices up 17% under Biden
- How they sell inflation
- Just 7 stocks Holding up Entire Market
https://open.spotify.com/episode/4ycKHhaiIZWc8gYTLsoEfl?
BLOOMBERG - JP Morgan CEO Jamie Dimon Plans to Sell $141 Million Worth of JPMorgan Shares
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Disposal to be Dimon's first such stock sale since beginning his tenure as CEO starting 2005
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"Sale is for financial diversification, tax planning: filing" (he legally can't say he thinks the stock will go down, he'll get lawsuits)
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Dimon and his family currently hold about 8.6 million JPMorgan shares, meaning the planned sale would represent less than 12% of their holdings in the New York-based bank. (How much more could he sell without causing a panic?)
(Oct-24-2023) Jamie Dimon rips central banks for being ‘100% dead wrong’ on economic forecasts
“I want to point out the central banks 18 months ago were 100% dead wrong,” he added. “I would be quite cautious about what might happen next year.”
In other recent warnings, Dimon warned of a potential scenario in which the fed funds rate could eclipse 7%.
“Whether the whole curve goes up 100 basis points, I would be prepared for it,” he added. “I don’t know if it’s going to happen, but I look at what we’re seeing today, more like the ’70s, a lot of spending, a lot of this can be wasted.”
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Gold Prices at new highs since May-2023 tradindg currently at $2006 https://goldprice.org/
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Silver Prices not seeing such a jump, still trading lower than earlier this week. Right now at $23.38/oz https://www.apmex.com/silver-price https://silverprice.org/
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Crypto - Bitcoin has seen a dramatic jump in the last few weeks. Other crypto has recently folowed suit as well. Bitcoin trading right now at $33,850, up 14% from last 7 days, along with several other Cryptos. https://www.coingecko.com
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Treasury Bond Yields have been pretty flat, the market is not fleeing to Treasuries in Extreme Fear which is very different from the past. https://www.investing.com/rates-bonds/usa-government-bonds
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KRE - SPDR S&P Regional Banking ETF - Trading down 30+% Year to Date. https://finance.yahoo.com/quote/KRE
DTCC: A Protocol Activation Event has occurred. ISDA Determinations Committee: a credit event has taken place with respect to Country Garden Holdings Company Limited.
https://dismal-jellyfish.com/country-garden-event-trade-information-warehouse-protocol-activated/
Evergrande was the 2nd biggest real estate in China. Country Gardens the biggest and it is now defaulting on its debt.
A fren asked when I think the stock market will crash and here is my reply. First some background and then my answer.
Background:
January is the estimated time when the Federal Reserve - Reverse Repo Market runs out.
https://fred.stlouisfed.org/series/RRPONTSYD/
That is what is being used to fund the governments insane spending, because when the government borrows money, they have to sell a US Treasury Bond backing that money. The US Treasury trades their Bonds for the cash parked in the Reverse Repo Market.
In the just 3 weeks the govt has borrowed $550 Billion+
https://twitter.com/WallStreetSilv/status/1712217005992939952
The Reverse Repo Market has drained 100 Billion almost every week for a month except the 3rd week of October. The Reverse Repo is being used to immediately buy Treasury Bonds and keep the interest rates of them (yields) from shooting up further.
Japan who owns $1 Trillion of US Treasury Bonds is also on deaths door. Historically when Yen-to-Dollar is 150/$ then the Bank of Japan intervenes and sells some US Bonds to raise value of yen against the dollar. That's happened a couple of times this month.
When Reverse Repo runs out, Treasury Bonds are going to shoot through the roof. This will be the 2nd big crash.
My Answer:
What do I think will happen? Short answer: 2 crashes in stock market then devaluing dollar then CBDC then freedom.
1st dip will be big enough most Boomers will think that was the crash and put all their money back in the stock market. I expect it around end of October - November before Thanksgiving from the way things are going but it may happen later. Boomers and older are important because they own about 70% of US Wealth and getting their wealth is the ultimate goal.
https://www.marketingcharts.com/demographics-and-audiences/youth-and-gen-x-75103
Govt will ramp up borrowing like crazy causing Treasury Bonds to crash in value and their interest rates to shoot up, possibly above the federal reserve base interest rate. Boomer money not in stock markets will go into Treasury Bonds. They will falsely think they are a safe haven as they've been trained to think.
Banks go insolvent from decreased Treasury Bonds value and are unable to back up deposits. They go bankrupt selling anything they own to cover any costs they can, causing more supply of Treasury Bonds on market dumping price lower and yields higher. Govt keeps borrowing and spending.
Reverse Repo runs out of money. Treasury bonds must be sold on the open market where nobody wants to buy. Values drop at insane levels and their interest rates shoot through the roof.
This will be the 2nd big crash that wipes out the rest of stock market and retirement money. Along with the Derivatives (estatimated $Trillion - 4 Quadrillion value), the Futures Market and even the paper gold/paper silver. I expect this to happen January-February but i am likely wrong on the exact timing here. This is the big boy to worry about. Physical cash will be very valuable at this point and it'll be the time to go spend your cash you have left. Any electronic cash will be gone and you'll be unable to access it.
Gold and silver will spike up overnight and maybe a bit for crypto but it won't hit its peak yet.
Then the govt will keep borrowing but nobody will buy Treasury bonds. No worries, the Federal Reserve has a fix for that from a paper that came out in Jackson Hole, WI this summer
Presenting the Fed's Perfect Plan for U.S. Dollar Oblivion | BestEvidence
https://www.youtube.com/watch?v=W0u5h579ZeU
https://www.kansascityfed.org/Jackson%20Hole/documents/9726/JH_Paper_Duffie.pdf
In this paper, the Federal Reserve and Govt solves the problem of having no Treasury Bond Buyers on the market. Currently the Federal Reserve can only buy Treasury Bonds that have already been sold from the US Treasury. This paper suggests to do away with that and have the Federal Reserve directly buy Bonds from the US Treasury. This will double inflation increase as the Federal Reserve will have to print money to buy the Treasury Bonds and more money is printed for the US Treasury once the bonds are sold.
There will now be no incentive for the govt not to borrow to oblivion and the physical dollars will quickly become worthless so you'd better get rid of your cash by then. Gold/silver, Crypto, Bullets, Food, Resources.
People will have to come together and do whatever they can for each other to survive this mess. Crypto will shoot up in use at this time because of instant transaction, long distance payments, and exact pricing. This will eventually take over by the peoples choice.
Govt buildings will be burning, urban city dwellers starving, and the pain will be so bad that people beg for a CBDC to stop from starving. That is the Cabal's bet and they will issue a CBDC at this time.
The foil to their plan will be gold/silver and ultimately crypto because the Cabal/Central Bankers have less of their hands in crypto than gold/silver (central banks have been massively buying precious metals) and its more usable over long distances. They won't be able to control people conducting their own business and they will fail dramatically. I think the military will step in when people have made the choice and decide against Central Banks and their CBDCs.
This is my best guess at the moment. I am likely wrong somewhere especially on the timeline, but as the govt actions play out over time, they become more predictable.
What do you all think?
