RobinhoodFX

The Ticking Time Bomb - Debt Markets

TVC:DXY   U.S. Dollar Index
If you ask 90% of people what drives stock prices, most of them will say things like “earnings, PE ratios, forward guidance.” The reality is that none of these things matter today.
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In today's market, factors such as earnings, PE ratios, and forward guidance play almost NO ROLE in the price action of a company's stock. The number one driver of stock prices is the price action taking place in the debt market. In fact, the stock market as a whole derives its value from action in the debt market – meaning that the stock market is a derivative of the debt market itself.image.png

To drive this point home, let's look at what central banks have been doing since the 2008 financial meltdown. They've been artificially suppressing interest rates, and it's worked really well in inflating another huge stock and real estate bubble. Low interest rates that are artificially suppressed by central banks create an environment of risk, as cash is forced into riskier assets such as stocks. This also drives up the price of real estate. In addition, this suppression of rates has robbed savers of trillions of dollars in wealth by keeping savings rates below the actual rate of inflation.

The global inflation and freefalling economy today are a direct result of central banks artificially suppressing rates for years following the last major meltdown.

Central banks are responsible for the global financial and economic systems, both of which are inextricably connected. Moreover, central banks working in concert are deliberately driving the world right into a financial/economic crisis of truly epic proportions.
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Central banks have been deliberately and meticulously working to hyperinflate a global debt bubble. Cracks in this bubble are now beginning to show, particularly in the form of rapidly rising global bond yields. This in turn is putting pressure on global stock prices. It is only a matter of time before an extreme sell-off in the debt market occurs.image.png

But a stock market crash- even one of this size- is the smallest issue. The real problem is a worldwide financial system shutdown, which means ALL TRANSACTIONS STOP. There would be no cash available from banks, credit cards and ATM cards would be unusable, no lending, everything would come to a halt.image.png

Do not be mistaken, central banks are working intentionally towards this inescapable end of the current system(s) only to usher in a new system that they have much more control over where, when and how much of their product Central Bank Currencies ie: ( USD, CAD, AXY, JXY, BXY) you can spend.

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