Historic Bond Bubble Means Fastest Rate Rise Ever – Martin Armstrong

“The boom cannot continue indefinitely. There are two alternatives. Either the banks continue the credit expansion without restriction and thus cause constantly mounting price increases and an ever-growing orgy of speculation – which, as in all other cases of unlimited inflation, ends in a “crack-up boom” and in a collapse of the money and credit system. Or the banks stop before this point is reached, voluntarily renounce further credit expansion, and thus bring about the crisis. The depression follows in both instances.” Ludwig von Mises

“This time it might be appear to be slightly different because not the banks in the US are expanding their credit but big amounts of capital will flow back to the USA, because of the Tax Reform…this will further pop-up the illusion of wealth for a short-time driven by inflation. More money will chase the same amount of goods, therefore prices can raise up fast, the outcome is called hyperinflation. I hope people will use this period also as an opportunity to think about time preference and to reflect on the idea that we have to safe first before we can consume. A society driven by high time preference is what we have today – swimming in an ocean of debt, corrupted by a system based on money created out of thin air. A guy said once: ““Gold is the money of kings, silver is the money of gentlemen, barter is the money of peasants – but debt is the money of slaves.” I suggest to end slavery – Putting some of the USD into physical gold and silver is a first step, building up a personal insurance against the outcome of this nightmare is a wise thing to think about.” Claudio Grass

Introduction podcast:
Is renowned financial expert Martin Armstrong worried about central banks continually buying bonds to suppress interest rates? Armstrong says, “Yes, absolutely. We are in the biggest bond bubble in history, not a stock bubble, but a bubble. . . . The scary thing in Europe is the ECB (European Central Bank) has been basically supporting the governments. It is subsidizing all the governments in the Eurozone. We are looking at almost 10 years of quantitative easing with that, and it hasn’t helped the economy. If the ECB backs off, who’s going to buy the debt?”

How does this end? Armstrong says, “Our computers are showing that interest rates are going to go up faster than anybody has ever seen in history. . . . You are looking at a doubling of interest rates very, very rapidly. . . . Gold and equities are the place to be.”

Join Greg Hunter as he goes One-on-One with Martin Armstrong of ArmstrongEconomics.com.

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