STEVE FERNANDES

We are living through the reconciliation of the GFC/banking crisis. They socialized the losses and privatized the gains with bailouts, kicking the can down the road as far as they can. The can is at our feet again. They increased the national debt from ~7 Trillion to ~32 Trillion in 15 years. The money supply went parabolic. Inflation is the highest it’s been in decades. Labor participation is the lowest it’s been in decades. Wealth inequality & homelessness is worse now than it was in 2008. The bond markets are more volatile now than they have been in decades. This is not a left vs right thing, it’s not political - both parties presided over the destruction of the dollar. There’s 3 paths forward: 1) No can kick. We won't get hyperinflation. -The bond markets crash. -Banks are insolvent, real estate crashes into a deflationary collapse. -They either don’t print because they know printing might cause hyperinflation or there is no buyers for the debt (confidence is lost in treasuries.) 2) Can Kicked. We get high inflation. -The bond markets get bailed out by the central banks (Fed balance sheet expands dramatically and the majority of USA’s debt is owned by the Fed.) -Banks are insolvent and it leads to further centralization of the banking system. 500-1000 small/medium banks rolled into the larger banks. Fed acquires $2 T+ of USTs from the insolvent banks. -Interest rates drop back near zero, inflation rises and we continue in a high inflation environment. -another crisis in 10 years. 3) Can kicked too hard. We get hyperinflation. -Banks collapse and Bond markets lock up. Stock market & real estate markets crash. -Both get bailed out by the Federal Reserve & Congress. -$20-30 Trillion gets printed over the next 1-5 years, causing a hyperinflationary collapse.