ECONOMIC UPDATE: It's an Economic Tower of Babel
Welcome to the in-your-face con-game brought to you by the Bankster Bandits who are nothing more than a money junky crime syndicate
NOTE TO READERS: The following is our weekly Economic Update — Market Overview found in this week’s issue of The Trends Journal. Consider subscribing here for in-depth, independent geopolitical and socioeconomic trends and trend forecasts that you won’t find anywhere else.
In February we warned Trends Journal subscribers to prepare for “March Economic and Equity Market Madness.” We also provided proactive measures to consider taking.
As we exit March, the “Equity and Economic Madness” that have been exemplified by bank failures in the U.S. and EU are just the beginning. The worst is yet to come.
Yet, the crooks and lie-in-your-face money junkies in charge will do all they can to keep propping up their economic Tower of Babel.
Welcome to the in-your-face con-game brought to you by the Bankster Bandits who are nothing more than a money junky crime syndicate. By their deeds you shall know them. They enrich “The Too Big To Fail” while the plantation workers of Slavelandia shrink from what used to be called “middle class” to broke and busted.
Need more proof? How about Washington and the Federal Reserve bailing out their billionaire and multi-millionaires club members whose deposits were not insured by the FDIC when the Silicon Valley bank busted?
Indeed, 88 percent of deposits were uninsured.
But for the plantation workers of Slavelandia paying off credit card debt with Bankster Bandit interest rates triple what the Mafia used to charge, can’t afford rent and have miserable jobs with wretched wages working for the mega-chains—or losing everything because they were laid off—there are no “bailouts.”
The Trends Journal was the first to forecast the “Panic of ’08”… we took out the domain name in 2007. As the Great Recession set in, the Bankster Bandits flooded the economic system and equity markets with ultra-cheap money when the “Panic” hit in ’08 until they began sharply raising interest rates in March of 2022.
Yes, a cheap money scheme: When the “Panic” hit, making up a new game that was never played before, the Fed slashed rates to zero and for several years they just gently kept raising them. And when they did raise them last March—the first hike in more than three years—they pumped them up only 25 basis points, bringing the rate into a range of 0.25 percent to 0.5 percent.
Plain and simple: When the cheap money dried up, so did the equity markets and the economy. Making a bad situation worse, beyond the money pumping scheme, when politicians launched the COVID War, to fight it, they flooded the economy with “free” money and zero interest policy. As a result, the economy that should have crashed flourished with a housing boom, strong consumer spending and record breaking equity market boom.
Now, the bet on The Street is that interest rates in the U.S. and around the world are near their peak. According to CME Group, the U.S. will hold interest rates where they are, start lowering them in July and bring them down one percent by year’s end. However there is still doubt as to whether the U.K. with its soaring inflation, and the European Central Bank which came late into the interest rate hikes, will continue to raise rates in May. In either case, the artificial economic boom is headed toward bust.
Yesterday, BlackRock, which manages about $10 trillion in investment money, noted the reality of the rising interest rate: “Recession.” And they are betting against the tide saying that the Feds will push interest rates higher.
FOLLOW GERALD CELENTE ON YOUTUBE
In its weekly note to clients, BlackRock wrote that “We don’t see rate cuts this year – that’s the old playbook when central banks would rush to rescue the economy as recession hit. Now they’re causing the recession to fight sticky inflation and that makes rate cuts unlikely, in our view.”
“Now they’re causing the recession,” got it!
Yes, recession is ahead and it is not “stagflation” that the markets are warning but rather “Dragflation.” The economy won’t “stagnate” as inflation rises… it will drag down.
Guessing Game, Guess What!
BlackRock went on to note that “We think the Fed could only deliver the rate cuts priced in by markets if a more serious credit crunch took hold and caused an even deeper recession than we expect.”
U.S. HAS SET THE WORLD UP FOR A WORSE FINANCIAL CRISIS THAN 2008
Again, there is near total agreement that a recession will hit, but the question remains how steep will it be?
What is important to note is that while we had forecast Dragflation when the Fed began to raise interest rates last March… now it is a “given.” The only question is, how bad will it be and what new schemes will the Banksters come up with to artificially prop up equities and economies… as they have a long track record of doing.
Putting her mouth where the money is, Christine Lagarde, the head of the European Central Bank, said last week that “While the European banking sector is resilient, with strong capital and liquidity positions, in view of recent financial market volatility we are ready to act.”
Yes, “ready to act.” Play any comedic and/or criminal role necessary to keep pumping up the banking system that is going bust.
Spewing out bullshit about “strong capital and liquidity positions,” Lagarde failed to mention that according to the ECB, Over the past five months depositors have withdrawn £214 billion from Eurozone banks while household deposits fell £20.6 billion … the largest amount since they started collecting data back in 2003.
And as for recession, total lending in Eurozone banks fell for the third straight month in February. Therefore, the higher interest rates go, the less lending and the deeper the economy falls into recession.
TREND FORECAST: Making a bad situation worse, the higher interest rates rise, the more money will be pulled out of banks and equities. Indeed, Bond yields rose yesterday as the rate on the 2-year U.S. Treasury note climbed back above 4 percent.
And on a much higher note that will bring down the banking and equity markets and help ignite the economic meltdown—as we have been warning, but silenced by the mainstream media—is our forecast of an Office Building Bust. According to Goldman Sachs, some 80 percent of commercial property bank loans are with regional banks.
And just like the Silicon Valley Bank that gobbled up U.S. Treasury Bonds, mortgage-backed securities and other “safe” assets, with interest rates now way higher than when they bought them, the market value of what the banks own are far below their book value. Therefore, when borrowers start defaulting on their commercial office building loans, and with less deposits going into banks, the banks won’t have the money to cover their losses or meet depositor demands.