A Glimpse Of The Next Global Crisis....
Everything in retrospect seems to be a disaster. All Asset prices have been massively inflated. Junk Bonds and T-bonds are in the narrowest margins since November 2007. This pretty much means that most corporations are offering debt at par value because they are worthy. Well soon we will see how worthy they are. The Federal reserve has already realized what beast they have unleashed since they enabled the easy monetary policy 9 years ago.
The Fed has already begun the process of tighten the monetary system. The Fed has started unwinding the balance sheet. They have an estimated 4.5 trillions dollars of debt filled with mortgage back securities and Treasury bonds. There plan is to move slowly. Slowly sell-off $10 billion worth of bonds a month and then eventually move to $30 billion by November 2018. The plan may seem good but this process will overheat our system with to many dollars that are valueless. It will be a lot harder to loan from U.S. commercial banks because lending rates will still be very high . All countries will start selling the U.S. dollars for reserve currencies or even cryptocurrencies. The U.S. dollar wont hold any significant value . The consumer will have a lot harder time purchasing domestic items. Then other countries will start to implode like the European union, and the bank of England.
The times will be very depressing. The historians will call it the resurrection. We as a society will be very vulnerable and any change that happens will be for the betterment of the globe. Change will first start to occur with how we see money. Cryptocurrency will be the new money. After such a traumatic event no sensible person would want to give their money back to the banks or even in fiat currencies. The only lasting thing there will be to transact with will be Cryptocurrencies.
I hope you guys enjoyed my scenario for what i think might occur when our next global crisis comes. Please leave me what you guys may believe.
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