Ironically, Bessent should know that propping up a currency is a failing proposition, as he was with Soros when they shorted the British Pound because it was impossible to keep propping it up. All we’re doing by buying the Yen is buying time. Dalio is right, the writing is on the wall, and stupidly, Trump is doing everything he can to bring about collapse quickly. His tariffs shrink the economy, his deportations shrink the economy, and his war boosts inflation, alienates allies, and drives up energy costs. In my opinion, the collapse is coming sooner rather than later, likely at some point in 2027.
What to watch for: With respect to the mid-term elections, expect violence at polling places. Trump will deploy his ICE stasi to polling places to suppress turnout, and likely initiate violence. If Democrats still win majority control, expect claims of rigged elections and a refusal to swear in the winners. Make no mistake, this is a coup underway, and sadly, I expect it will likely succeed.
This of course will undermine confidence in the U.S. and the dollar, and cause rates on treasuries to reflect a significant risk premium. We’re already consistently above 5% on 30 year treasuries, and that will get much worse. With fewer buyers, the fed will be forced to buy treasuries, which is basically money printing. Also expect the fed to keep rates low. We’ll have a boom in stocks followed by a blowoff top and collapse that will make 1929 look quaint. Gold will go through the roof. I expect gold to make a new all-time high above $5600/oz this year, and top $20K/oz when the shit really hits the fan next year.
The worldwide economic malaise resulting from the collapse of the U.S. economy will have lasting repercussions, and we can expect world war to follow. It will take a generation or more for the U.S. to come back from this. We’re living in interesting times!
Ironically, Bessent should know that propping up a currency is a failing proposition, as he was with Soros when they shorted the British Pound because it was impossible to keep propping it up. All we’re doing by buying the Yen is buying time. Dalio is right, the writing is on the wall, and stupidly, Trump is doing everything he can to bring about collapse quickly. His tariffs shrink the economy, his deportations shrink the economy, and his war boosts inflation, alienates allies, and drives up energy costs. In my opinion, the collapse is coming sooner rather than later, likely at some point in 2027.
What to watch for: With respect to the mid-term elections, expect violence at polling places. Trump will deploy his ICE stasi to polling places to suppress turnout, and likely initiate violence. If Democrats still win majority control, expect claims of rigged elections and a refusal to swear in the winners. Make no mistake, this is a coup underway, and sadly, I expect it will likely succeed.
This of course will undermine confidence in the U.S. and the dollar, and cause rates on treasuries to reflect a significant risk premium. We’re already consistently above 5% on 30 year treasuries, and that will get much worse. With fewer buyers, the fed will be forced to buy treasuries, which is basically money printing. Also expect the fed to keep rates low. We’ll have a boom in stocks followed by a blowoff top and collapse that will make 1929 look quaint. Gold will go through the roof. I expect gold to make a new all-time high above $5600/oz this year, and top $20K/oz when the shit really hits the fan next year.
The worldwide economic malaise resulting from the collapse of the U.S. economy will have lasting repercussions, and we can expect world war to follow. It will take a generation or more for the U.S. to come back from this. We’re living in interesting times!