This global collapse will be far worse than the wipeout that took place in 2008-09.
July 2 (King World News) – Eric King: “I had always said that this cycle will become more violent. We saw the collapse in 2000-2002, especially the Nasdaq that fell 80%, and I kept saying, “It’s going to get worse. The next one will be much more violent.” Then we had the 2008-2009 collapse and people said, “Oh God, it was worse.”
There’s that felling that whatever is in front of us can’t be worse than 2008-2009, but I’m still saying, “It’s going to get worse.” I don’t know how but it’s going to be a lot worse. That could be a hyperinflation, but whatever it is it’s going to be much more violent this time than what we saw in ’08-’09. I think it’s hard for people to imagine that, but when you step back and look at the brittle structure of what’s left of this global monetary system, can you envision that (a much greater collapse)?”
Matthew Piepenburg: “Yeah, I think it’s frustrating because when you talk bluntly and candidly and openly about things like history, people think if you have a negative view that you are just a gloom and doomer. I think we are all getting tired of that because I think what’s lacking today is openness and candor. And to your question, I was there and I made a lot of money during the Dotcom bubble. I remember it well. I remember trading through the 2008 bubble, and I remember the policy reactions. It’s not theoretical to me, I lived through it and actually benefitted from that nonsense.
But I can still say objectively that in 2008 the Federal Reserve’s balance sheet was less than $1 trillion. And then by 2020 it rose to $9 trillion. And we printed more money in 2020 than we did in 2009-2014. So the Fed has bloated its balance sheet to levels never before seen in history, and at the same time our public debt has also risen to levels never seen before in history. So yes, when the next bubble crashes the macro backdrop to the next crisis is infinitesimally worse than it was in 2008 during the S&P crisis and the subprime crisis or anything that we saw during the Nasdaq crisis. The Nasdaq crisis was relatively confined to tech stocks, the 2008 crisis was a cancer that spread from real estate and mortgage-backed securities and asset-backed securities.
We’re in an everything bubble from art to cars to stocks and bonds, and we’re at the highest debt levels in our history with our Debt/GDP over 120%, while during the Volcker era it was around 40%. So any kind of fragility, any kind of shock to the system is going to be worse than 2008. That’s based on pure math and facts of debt, not opinions or on politics. Even if someone is a fan of Yellen, Powell, Greenspan or Bernanke, even if they want to defend them and pretend that the people in those neckties, dresses or suits who are from the fancy schools are going to save them because it feels good to believe that, it’s simply naive.
Every debt drunk regime, every debt crisis ends in a market crisis, it ends in a currency crisis, it ends in social unrest, it ends in a political crisis, and ultimately that political crisis turns to extreme control from the left or the right, throughout history, without exception. And what we are seeing from the mask mandates to the lockdowns to the shutdowns to the DoJ’s false arrests in the US is just more authoritarianism. It’s not only scary to see markets collapsing that have been sustained by fantasy…to continue listening to Matthew Piepenburg discuss why the coming collapse will be far worse than anything we’ve witnessed this century and much more CLICK HERE OR ON THE IMAGE BELOW.
***To listen to Alasdair Macleod discuss the major shock that is coming to the commodity markets as well as what to expect from gold and silver CLICK HERE OR ON THE IMAGE BELOW.
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