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Scorpio

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after hitting real low lows, bond yields or interest rates have been moving up just a touch from Aug or so

2.png
 

BackwardsEngineeer

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Things offshore are in a word dismal... continue to hear stories from tourist destinations we made long term relationships how tough things are for both ex pats and locals. Amazing how many expats invested their retirement $ in 20 room and under boutique hotel/b&b. We always found them to be really fun stays so have sought them out while traveling, making long term friends as we went.... Many are closing up shop, one outside of London are moving to the country, said they can't even make the monthlies much less a profit. Others slowly being sucked dry, foregoing maintenance praying for any relief. Our favorite in Dingle, Ireland has had enough EU guests to stay just below even. Surrounding restaurants burdened by commercial leases and equipment costs are closing left and right, no tourists means can't even do carryout but more important no booze $. Saw posted video comparing Dingle 2019 vs 2020 Christmas eve, 19 no cars allowed streets full shoulder to shoulder, 20 not a car or person to be found everything closed. Tour operations folding as they expanded from 2015 to 20, big payments not being made and layoffs abound...

We bitch and moan about things stateside but its going to takes years to ramp back up where these places were... almost scary how bad things have gone so quickly. Travel is such a huge industry employing so many, from here to there... touches everything.. BTW lots of people I talk with are using BTC bought last spring to buy of properties elsewhere... with huge smiles
 

Uglytruth

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Things offshore are in a word dismal... continue to hear stories from tourist destinations we made long term relationships how tough things are for both ex pats and locals. Amazing how many expats invested their retirement $ in 20 room and under boutique hotel/b&b. We always found them to be really fun stays so have sought them out while traveling, making long term friends as we went.... Many are closing up shop, one outside of London are moving to the country, said they can't even make the monthlies much less a profit. Others slowly being sucked dry, foregoing maintenance praying for any relief. Our favorite in Dingle, Ireland has had enough EU guests to stay just below even. Surrounding restaurants burdened by commercial leases and equipment costs are closing left and right, no tourists means can't even do carryout but more important no booze $. Saw posted video comparing Dingle 2019 vs 2020 Christmas eve, 19 no cars allowed streets full shoulder to shoulder, 20 not a car or person to be found everything closed. Tour operations folding as they expanded from 2015 to 20, big payments not being made and layoffs abound...

We bitch and moan about things stateside but its going to takes years to ramp back up where these places were... almost scary how bad things have gone so quickly. Travel is such a huge industry employing so many, from here to there... touches everything.. BTW lots of people I talk with are using BTC bought last spring to buy of properties elsewhere... with huge smiles

The "service industry" no matter the location is dependent to freedom of movement. Lockdown = no movement. Lockdown means no travel. Lockdown means events canceled. Lockdown means everything from gas to ice for the cooler to restaurants to oil changes to motels, suitcases etc.... there is little need.

Next comes the breakdown of foreclosures in business to homes to commercial realestate. Wonder who is planning on buying it all up. Should be watching that sort of thing.

In hindsight, most small business instead of "fighting through" would have been better off liquidating in March of 2019 when we had the 2 week lockdown to flatten the curve and would have been ahead of the curve and money ahead. instead they made themselves bag holders.......
 

Uglytruth

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Anyone have any information on leases that were renewed. If & how terms had changed?
I have heard some getting free rent for 12 months to lockdowns give reduced rates or skip a month until lockdowns let up.
 

Scorpio

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some serious resistance above at 1900 gold and 27 silver,

both getting pounded consistently off those levels,

going to take some buying energy to clear those
 

Scorpio

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U.S Mortgage Rates Fall to a 16th Record Low of the Year ahead of the Holidays
10448e379b686648f1859ab098404c6a




Bob Mason
Sat, December 26, 2020, 7:39 PM CST



Mortgage rates fell to a 16th record low of the year after a 4 basis points fall to a 15th record low in the previous week.
Compared to this time last year, 30-year fixed rates were down by 108 basis points.
30-year fixed rates were also down by 228 basis points since November 2018’s most recent peak of 4.94%.

Economic Data from the Week
Economic data was on the busier side in the 1st half of the week.
November personal spending, inflation, and core durable goods orders, together with consumer confidence and jobless claims figures were in focus.
It was a mixed bag on the economic data front. Consumer confidence waned in December, while initial jobless claims fell from 892k to 805k.
The annual rate of core inflation held steady at 1.4%, while personal spending fell by a larger than expected 0.4%.
Durable goods and core durable goods orders continued to rise, however, following October’s jump, supporting riskier assets.
From Capitol Hill, progress towards a COVID-19 stimulus package was risk positive, while continued concerns over COVID-19 and news of new strains tested support in the week.
Later in the week, U.S President Trump refused to sign the COVID-19 stimulus package. Hopes of a better package supported riskier assets mid-week before news of lawmakers refusing Trump’s demands hit the wires.
Freddie Mac Rates
The weekly average rates for new mortgages as of 24th December were quoted by Freddie Mac to be:
  • 30-year fixed rates fell by 1 basis point to a new low of 2.66% in the week. This time last year, rates stood at 3.74%. The average fee remained steady at 0.7 points.
  • 15-year fixed rates fell by 2 basis points to 2.19% in the week. Rates were down by 100 basis points from 3.19% a year ago. The average fee fell from 0.6 points to 0.5 points.
  • 5-year fixed rates held steady at 2.79% for a 2nd consecutive week. Rates were down by 66 points from 3.45% a year ago. The average fee fell from 0.3 points to 0.2 points.

https://finance.yahoo.com/news/u-mortgage-rates-fall-16th-013937286.html
 

pitw

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How do they expect anyone to want to go to work? Oris that the goal?
 

Scorpio

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good question,

fwiw, dollar closed under 90 yesterday on the index,
and today continues to sink to mid 89's

in 2011 the dollar got as low as 73 and change to paint the metal highs
 

Scorpio

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At the top of the banks website

looking for your stimulus check?
set up a alert on your phone so you know when it gets here..............


twilight zone
 

Uglytruth

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good question,

fwiw, dollar closed under 90 yesterday on the index,
and today continues to sink to mid 89's

in 2011 the dollar got as low as 73 and change to paint the metal highs
Ah yes the $4.50 gallon gas years.....
 

Scorpio

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dollar closes under 90 2 days in a row now,

gold taking yet another shot at the 1900, while silver has a bit to go to get to the 27

I think if both get thru that resistance, there will be a bit of a run to the up

Both have been successfully capped multiple times at those levels, short term charts
 

savvydon

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dollar closes under 90 2 days in a row now,

gold taking yet another shot at the 1900, while silver has a bit to go to get to the 27

I think if both get thru that resistance, there will be a bit of a run to the up

Both have been successfully capped multiple times at those levels, short term charts
Yes, we are knocking on the door. Let’s see if 2021 is the code to open it.
 

Scorpio

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I am with you on that savvy

we look at minor numbers in metals while chitcoin is killin' it to the up, now knocking on 30 grand
 

Scorpio

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yesterday gold tried like heck to clear the 1900, but silver was acting as a dead weight and by end of day, no joy for gold,

then today again, gold tries once again to clear, but silvah again with different ideas, coughing up a hairball,

to shorten this up,

silver hasn't been confirming the attempts in gold,

they both need to giddyup to make something happen
 

savvydon

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they both need to giddyup to make something happen
I think TPTB are holding the reins. They will run when they are set free. I expect soon, but then again, I have been expecting soon for a long time...
 

Scorpio

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a few interesting notes as the week starts,

from the overnights, metals of course are up decent,

oil broke after getting to just under 50, rolled off a dollar of those gains
the usd, after making a attempt to get back over 90 and failing last trading day of last year, opens the year down hard, and now 89.40

while all of this is going on, the stock market continues to rise, day after day
with a weaker dollar, with oil prices rising, with a non-confirmed election, and with outsized valuations

begging the question, where is the dough coming from to buy the stocks overall?
we are not talking of small amounts pushing this buggy up the hill

just for giggles, in addition to the sp500 chart and the continued painting of new highs,
attached a chart of the german dax also. You can see germany finally has gotten back to its highs of last March pre boo hoo flu

as for the french, they still haven't gotten back to those levels, that chart is also attached.

if ferners were buying the us markets, you would think the dollar would be going up,
and if they aren't buying, then again, where is all the slush coming from?

spx daily
german weekly
french weekly


1.png



2.png


3.png
 

Scorpio

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U.S. dollar index falls to lowest level since April 2018
Published: Jan. 4, 2021 at 4:03 a.m. ET
By
Steve Goldstein

The U.S. dollar index slipped 0.3% to 89.51, the lowest level since April 2018. The greenback fell more than 6% in 2020, weakening as global financial conditions improved. The U.S. Federal Reserve has cut interest rates to nearly zero, expanded bond purchases and established a number of different programs to support credit.



https://www.marketwatch.com/story/u...vel-since-april-2018-2021-01-04?mod=home-page
 

Scorpio

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gold working on clearing resistance in the 1938 area, next R is around 1962 or so short terms and about 1964 on dailies

while silver is looking to take out old 27.62 and now working on 27.78 consolidation highs, on the short term,
on dailies it is about 27,84 resistance
 

Scorpio

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dems sweep Ga and metals move up,

silvah trying to get over 28 now, taking out prior resistance around the 27.78,
did get over 28, and now has rolled a bit down to just under that number

gold continues to work its way higher overall, has not gotten to that resistance at 1962 as of yet,
with it currently flopping around unchanged to down a bit

dow green for now, but on thin ice as the daq and 500 are both down for the time being
 

Scorpio

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interesting to note,

the 10 year has jumped over 1% this morning,

we have been under 1 for a long time now there,
been moving up since Aug from the 0.5 level

rates moving up while europe announces zero morts????

some divergence there


ust.jpg
 

Scorpio

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the hammer has come out on metals and they are getting after them

perfect scalping going on, like sellers overwhelming the book
 

Scorpio

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yep miners have held up pretty good all day,

metals gaining back some lost ground also
 

Scorpio

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pretty darn interesting that with all the commotion, someone has their eyes on the metal markets and keeping them down

meanwhile, chitcoin is movin' on up, about 37k now painted, massive gains in a short period,

surely allowing that instead of metals, the new hidey hole is chitcoins and comparatives

and they are leaving the dinosaurs to their trinkets
 

Scorpio

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Apple now has $191.83 billion in cash on hand — down nearly 7% from a year ago
PUBLISHED THU, OCT 29 20204:34 PM EDTUPDATED THU, OCT 29 20206:17 PM EDT

Michelle Gao@MICHGAO
SHAREShare Article via FacebookShare Article via TwitterShare Article via LinkedInShare Article via Email
KEY POINTS
  • Apple has $191.83 billion in cash, according to its fiscal fourth-quarter earnings.
  • That’s down from the company’s fiscal third quarter of 2020, when it reported $193.8 billion in cash.



Apple now has $191.83 billion cash on hand, according to the company’s fiscal fourth-quarter earnings report released Thursday.
That’s down from the company’s fiscal third quarter of 2020, when it reported $193.8 billion in cash. It’s also down from Apple’s fiscal fourth-quarter 2019 earnings, however, when it reported $205.9 billion in cash.

Apple regularly has one of the largest cash piles among U.S. companies and hit a $2 trillion market cap in August, although it has fallen below that number.
Google and Amazon had $121.08 billion and $71.77 billion, respectively, at the end of the second quarter, according to FactSet. Microsoft had $137.98 billion at the end of its fiscal first quarter, according to FactSet. Microsoft’s first-quarter 2021 results were released earlier this week.


https://www.cnbc.com/2020/10/29/apple-q4-cash-hoard-heres-how-much-apple-has-on-hand.html
 

Scorpio

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gold needs to get its act together here soon or it is going to be dead to quite a few,

50dma is sinking fast and heading for a cross of the 200 to the down,
if it did, that would encourage yet more selling

if you notice, those hits on gold have been coupled with larger volume prints too


1.png
 

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gold needs to get its act together here soon or it is going to be dead to quite a few
Perhaps that is what the market needs to really take off. Thin the heard so to speak, a little sleight of hand so that the trade is less crowded. Give the smart money a chance to sneak into the show and get front row seats.
 

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Quick note on real estate .... never have we seen it move like the first 10 days of 2021. I had clients at a national builders model homes Fri & Sat watched couple after couple show up to buy. Like 8 deals plus the two we got going in 4 hours. This point last year 4200 active single family in our mls... this year 1600 and I would argue the only reason we have the 1600 is 15% overpriced or they are dogs with fleas..

Back at it hoping to book my yearly quota prior to 3/1....
 

TAEZZAR

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Uncle

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I see you have pink and rainbows in your memes these days..............

Don't get any fargin ideas now. There is nothing wavy or blue and no ponies.

Golden Regards
Uncle
 

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Two Centuries Of National Debt In One Year: Putting 2020 In Perspective

By Daniel R. Amerman, CFA

The $4.5 trillion increase in the U.S. national debt in 2020 was so large as to be almost incomprehensible for the average person. Yet, every dollar of the new debt was entirely real. It will likely be with us for the rest of our lifetimes, and may profoundly change every aspect of our financial lives, including Social Security, Medicare, stock prices, gold prices, real estate prices, and the value of retirement accounts,


This analysis uses historical comparisons to help put 2020 in perspective, and make more concrete and tangible what really happened last year. It also explores the underlying issues, and shows why the actual situation is even worse than most people realize.


The analysis is part of a series of related analyses, which support a book that is in the process of being written. Some key chapters from the book and an overview of the series are linked here.

The Stunning Increase In The National Debt

According the to the U.S. Treasury Department, the national debt of the United States reached $27.7 trillion by the end of 2020. There was an unprecedented degree of government borrowing to try to limit the damage from the economic shutdowns that were used to try to slow and control the spread of the COVID pandemic. Paying for the total costs of the many stimulus programs, including the checks to individuals and households, increased the single year deficit to a stunning $4.5 trillion.


While it is too early to know what the total will be for 2021, the current political indications are that the next rounds of stimulus spending will be almost guaranteed to bring the national debt above $30 trillion sometime during the year. Indeed, a repeat of 2020 would bring the total national debt to $32.3 trillion by the end of the year.


DebtEconBD.jpg



As can be seen in the graph above, the rapid increase in the national debt in 2020 was by far the largest that has ever been seen. The next closest was the $1.7 trillion increase in the debt in 2010. The growth in the debt in 2020 was an extraordinary 2.7X time greater than the previous record.


What also needs to be remembered is that the annual deficits associated with the Financial Crisis of 2008 were themselves unprecedented, going far above any previous increase in the national debt. The $1.7 trillion increase in the national debt in 2010 had itself been almost 3X greater than the previous record of $598 billion, that had been set in 2004, as part of the attempt to contain the damage from the collapse of the Tech stock bubble and the associated recession.


What started in 2020 (and may still have a long ways to go) was the third round of the upwards explosion of the national debt over the last two decades. We saw record deficits in the attempt to contain the damage from the 2001 recession. There was a near tripling of peak annual deficits in the attempt to contain the damage from the 2008 recession. And we are now seeing yet another near tripling of peak annual deficits in the attempt to contain the damage from the 2020 recession.


Two near triplings in a row, with two rounds of major crisis and the containment of crisis, have produced about a 7.5X increase in peak annual deficits during crisis, when compared to the all time record that had previously been set in 2004.

217 Years Of Debt In 1 Year

DebtEconBD6.jpg



To help gain some perspective on just how historically off the scale the run up in the national debt was in 2020, the green bar on the left in the graph shows the total national debt accumulated by the United States between 1776 and 1993, the first 217 years of the nation. That totaled $4,536 billion, or $4.5 trillion in debt.


The red bar on the right shows the increase in the national debt in 2020 alone, which was $4,546 billion, or $4.5 trillion in new debt in one year.


Many people remember 1993 and the years before. The national debt was considered to be a big deal at that time, as it has been for decades and centuries before that time.


For hundreds of years, financially and economically literate people had been worrying over the size of the national debt, and the very troubling growth in the national debt. They had good, historically sound reasons for their concerns. Very large national debts have economically crippled many nations over the centuries, most often eventually leading to lower rates of economic growth and higher rates of inflation, although there are also episodes of outright default as well when the debt had been borrowed in the currency of another nation (such as Argentina borrowing in U.S. dollars).


We are quite literally talking about multiple lifetimes of never ending political debates and concerns over how to restrain the growth in the national debt, that after more two centuries of failing to do so, had led to the fantastic level of the United States being $4.5 trillion in debt.


And yet, almost without political or other public debate, that same amount was added again in a single year instead of 217 years. And an equal or greater amount of debt that will be owed by us all may be added again in 2021.

Taking Inflation Into Account

As long time readers know, I often write about inflation, its relationship with the national debt and monetary creation, and also about finding the financial opportunities that are created by inflation (link here).


For people who think in inflationary terms - they may be quite unimpressed with comparing simple dollars between 2020 and the decades before. All one has to do is discount for the dollar being worth much less than it used to be, and these kinds of alarming comparisons can often just disappear.


So let's be economic sophisticates, wave our hands by adjusting for inflation, and "poof", make most of that silly comparison of 217 years of debt creation versus the single year of 2020 vanish.


DebtEconBD7.jpg



Uh oh.


As can be seen in the graph above, when we fully adjust for inflation and move everything to 2019 dollars, so we are comparing apples to apples, then we've still got a big problem. The national debt in 1984 was $1,663 billion, which is $1.7 trillion, and when we adjust for a dollar in 1984 being worth $2.45 when compared to what $1.00 would buy in 2019, then we have an inflation-adjusted national debt of $4.1 trillion in 1984, after 208 years of the growth in the national debt.


So even after taking inflation into account, the single year increase in the national debt in 2020 was still substantially higher than the entire increase in the national debt between 1776 and 1984.


Instead of reducing concerns, the comparison actually got much worse when we moved to purchasing power, going to "like to like" for the increase in the debt relative to the value of salaries, of savings, of homes and of everything else. In absolutely real dollars, real purchasing power, the United States in a single year did run up a larger increase in the national debt, then the total borrowings over the first 208 years of the nation, combined.


Inflation is not actually the issue here. The real problem is the near tripling of the previous record annual deficit by 2010, and the next near tripling of the previous record in 2020. The new government policies of freely running up impossible debts for short term economic and political advantages without giving a thought to the longer term consequences is truly unprecedented, the nation had never previously been that short-sighted and irresponsible, and the comparison of running up more debt in a single year than over two centuries is indeed fair and real.


If we use 25 year generations, 25 years on average between each generation, then it took eight generations of politicians borrowing from the future to spend in their day, with eight generations of voters and savers being deeply worried and trying to fight the growth in the national debt, to reach the astonishing and depressing place where in current dollars the national debt had reached over $4 trillion. Fully taking inflation into account, the United States did indeed borrow more in the single year of 2020, borrowing from the future to pay for a single year today, than it had in its first two centuries of existence.


And it may do the same again (or more) over the coming year.

Just Because It Seems Surreal Doesn't Mean It's Not Real

The events of 2020, politically, economically and for society, were enough to leave many people dazed, confused and even shell-shocked. So many bizarre things were happening at the same time, developments that many of us never expected to see in our lifetimes, that it was hard to comprehend everything that was happening.


The increase in the national debt was surreal - perhaps even to the point that many people simply could not comprehend it. How could so many dollars possibly be borrowed and spent? How could so many of those dollars just come into existence from what very few people understand, something that didn't even exist before 2008, which is reserves-based monetary creation from the Federal Reserve? For the average person, the amounts are so vast as to be incomprehensible, with the sheer scale of what was happening making some people less likely to think about it than if the numbers had been smaller.


But yet, just because something is so large as to seem surreal - does not in fact make it any less real. Every one of the 4.5 trillion dollars in the new national debt is real, and it is every bit as real as any other dollar, such as the dollars that make up the nation's incomes, savings and retirement accounts.


The problem is perspective when the numbers are so vast. One of the intended purposes of this analysis is to provide that perspective, to give us something to peg it to, something more tangible to relate to in order to make surreal more comprehensible.


All of our futures did change when the national debt jumped by the extraordinary sum that it did in 2020 - it would be deeply naive to think otherwise. These aren't "Monopoly dollars", and as the numbers get ever higher and more difficult to comprehend, it isn't that they start to diminish in importance, but rather they get ever more important when it comes to changing everything else in our lives.


Inflation, the value of the dollar, and the value of savings will change. Stock prices, precious metals prices (link here), bond prices and home prices (link here) are all likely to profoundly change as well over the coming years and decades.


This goes to the heart of the earlier chapters of this book, and the cycles of crisis and the containment of crisis. The pandemic is what set off this round, but it isn't the underlying cause. This is the third crisis in a row to be contained using the combination of very low interest rates and major increases in the national debt. The debt is never paid back, the monetary creation by the Federal Reserve is never fully unwound, and all that is done is that a new and more fantastic base is set for the next round.


That's how it works - until it doesn't.


The truly unfortunate part of this is that many people have no idea what is going on, but they do see what appears to be massive sums of "free money" being created and spent, and instead of disaster, are seeing record stock, bond and home prices. As far as they can tell, there is no real danger here.


As explored in earlier chapters in this book, the reality is that we have all been going down a path with no realistic exit ramp, no way to get off with sound money and the value of investment assets preserved. Instead there is a series of crises, and a series of the containments of crisis, with the increases in the national debt and the increases in the creation of money by the Federal Reserve increasing by an order of magnitude with each round.


RedBlackCweb.jpg



That is not the same thing as gloom and doom thinking. As explored in detail using the Red/Black matrix shown above (link here), in chapters written well before this crisis, record stock prices, record bond prices and record home prices are the logical consequences of the massive monetary creation and lower interest rates that would be the results of the next cycle of the attempted containment of crisis. We studied in this book what the Fed said it would do in advance, then the Fed actually did it, and the expected increases in stock, bond and home prices did then in fact follow, for the reasons explained in advance.


However, even while prices went up as expected - the eventual Destination also just got quite a bit closer. A huge chunk of the limited ability to keep this all going just got used up in 2020, and a large part of what safety margin there was is no longer there. We still can't know the specific year at this point, but what is coming afterwards just got substantially closer (and more inevitable) for all of us, as the necessary downstream effect of running up more than two centuries of national debt in a single year.


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Uglytruth

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There was an unprecedented degree of government borrowing to try to limit the damage from the economic shutdowns that were used to try to slow and control the spread of the COVID pandemic.

When money is not real debt is false. It can not and will not ever be repaid. It is used for one thing just like the kung flu. CONTROL!
911 CONTROL! Tax laws CONTROL Fear CONTROL Fake News CONTROL censorship CONTROL. If you look there just might be a pattern here.