Japan Just CRASHED The US Market!
Summary
TLDRThe video discusses the economic conflict between the Bank of Japan and the Federal Reserve, which has led to a global market upheaval. Japan's unexpected interest rate hike challenges the Fed's dominance, causing market chaos. The video delves into the economic strategies of these central banks, the risks of the Japanese yen carry trade, and the potential implications for global financial markets and individual investments. It also examines the 'impossible trilemma' of monetary policy, capital flow, and exchange rates, and speculates on the future paths of monetary policy in response to current economic pressures.
Takeaways
- 🌐 The Bank of Japan's unexpected interest rate hike challenged the Federal Reserve's dominance and caused global market turmoil.
- 📉 Japan's move was a response to the 'Lost Decades' of economic stagnation and stagflation, where traditional monetary policy failed to stimulate growth.
- 💹 The sudden change in Japan's monetary policy led to a sharp rise in the Japanese Yen's value against the US Dollar, impacting global currency markets.
- 🏦 The 'impossible trilema' faced by Japan and other nations involves the balance between free capital flow, a fixed exchange rate, and an independent monetary policy.
- 🔄 The carry trade, which profited from the low-interest rates in Japan, led to a massive short position against the Yen, creating systemic risk.
- 📈 The Federal Reserve's aggressive rate hikes in 2022 caused the Yen to plunge, prompting Japan to intervene in the currency markets to stabilize its currency.
- 🌪️ Japan's rate hike to shake off short sellers has had a domino effect, causing a potential deflationary crisis and market instability.
- 💔 The high debt-to-GDP ratio in Japan poses a significant challenge to normalizing interest rates without causing severe economic repercussions.
- 🌳 The dilemma faced by Japan and other nations is whether to risk a currency crisis or a deflationary crash, which could lead to a Great Depression-like scenario.
- 💰 The script suggests that governments are likely to choose inflation over deflation, potentially leading to a new wave of asset inflation beyond what was seen in 2020.
- 🚀 The presenter forecasts a 'Quantum wave leap' in technology and asset prices, advising viewers to understand market cycles to make informed investment decisions.
Q & A
What is the main conflict discussed in the video script between the Bank of Japan and the Federal Reserve?
-The main conflict discussed is the unexpected move by the Bank of Japan to raise interest rates, challenging the Federal Reserve's dominance and causing global market chaos.
Why did Japan's decision to raise interest rates cause such a significant impact on the global markets?
-Japan's decision was unexpected and went against the trend of keeping rates near zero, which caught the market off guard and led to a sharp increase in the Japanese Yen's value against the US Dollar.
What is the 'Lost Decades' referred to in the script, and how does it relate to Japan's economic situation?
-The 'Lost Decades' refers to the period of economic stagnation in Japan, characterized by market crashes and lack of growth, where Japan struggled with stagflation and had interest rates at zero or negative for an extended period.
What is the 'impossible trilemma' mentioned in the script, and how does it affect a country's financial policy?
-The 'impossible trilemma' is a situation where a country can only have two of the following: free flow of capital, a fixed exchange rate, and an independent monetary policy. It affects financial policy by forcing a country to choose between these options, impacting their economic strategy and global financial relations.
How does the Federal Reserve's aggressive rate hiking cycle affect the Japanese Yen?
-The Federal Reserve's aggressive rate hikes made the US Dollar stronger, which in turn caused the Japanese Yen to plunge in value as investors moved towards the higher-yielding US assets.
What is the 'carry trade' mentioned in the script, and why is it significant in the context of Japan's financial situation?
-The 'carry trade' is a strategy where investors borrow money in a country with low-interest rates (like Japan) and invest it in a country with higher returns. It is significant because it created a massive risk for the market when Japan raised its interest rates, causing a rapid unwinding of these trades and putting downward pressure on the Yen.
Why did Japan's verbal warning about taking action on currency if needed come after the Yen's value continued to plunge?
-Japan's verbal warning was an attempt to deter short sellers who were betting against the Yen and to stabilize its currency. However, the continued plunge indicated that market participants were not convinced by the warning and continued to sell the Yen short.
What is the potential consequence if Japan were to normalize its interest rates with the Federal Reserve's rates?
-Normalizing interest rates with the Federal Reserve could lead to Japan paying a significant portion of its GDP in interest on its debt, which could be unsustainable given its high debt-to-GDP ratio.
What are the two main choices Japan faces in response to the current financial challenges, as outlined in the script?
-The two main choices are to either allow the Yen to continue to fall, leading to a currency crisis, or to attempt to save the currency by fighting off short sellers, which could lead to a deflationary crisis.
How does the script suggest governments typically respond to financial crises, and what does this imply for the future of asset prices?
-The script suggests that governments typically choose to print more money to avoid a deflationary crash, which can lead to inflation and push asset prices to new highs, as seen in the aftermath of the 2020 economic shutdowns.
Outlines
🌐 Central Bank Showdown: Japan vs. Federal Reserve
The script begins by setting the stage for a financial battle between the Bank of Japan and the Federal Reserve, highlighting the potential for market chaos. Japan's unexpected decision to raise interest rates is portrayed as a bold challenge to the Federal Reserve's global dominance. The implications of this move for asset prices and the financial future of investors are underscored, with the narrator, Mark Moss, positioning himself as an experienced investor and educator who will guide viewers through the economic chess game unfolding on a global scale.
📉 Japan's Desperate Move and the Global Market Impact
This paragraph delves into Japan's economic desperation, characterized by decades of stagnation and the recent surprise decision to raise interest rates, which has sent shockwaves through global markets. The discussion introduces the concept of the 'impossible trilemma' faced by countries with central banks, illustrating the trade-offs between free capital flow, fixed exchange rates, and independent monetary policy. The narrative focuses on how Japan's actions have led to a significant appreciation of the Japanese Yen and a drop in the US Dollar Index, indicating a shift in global financial power dynamics.
💹 The Unraveling of the Japanese Yen Carry Trade
The script explains the mechanics of the Japanese Yen carry trade, which has been a significant driver of global financial markets. It describes how investors borrowed in Japan at near-zero interest rates to invest in higher-yielding assets, particularly in the US. The sudden rate hike by the Bank of Japan has disrupted this trade, causing a rapid unwinding that has put downward pressure on the Yen and global asset prices. The comparison to the collapse of the cryptocurrency exchange FTX is used to illustrate the precarious nature of this financial situation.
🏦 Japan's Debt Dilemma and the Global Economic Crisis
This section discusses Japan's massive public and private debt, and the potential consequences of normalizing interest rates with the Federal Reserve. It outlines the dire economic scenario that would result from Japan attempting to raise rates to levels that could match the Federal Reserve's, highlighting the unsustainable cost of servicing their debt. The script suggests that Japan is at a crossroads, facing the choice between a currency crisis and a deflationary crisis, with global implications for financial markets.
🌪️ The Great Dilemma: Inflation vs. Depression
The final paragraph contemplates the broader global economic implications, drawing parallels between Japan's situation and potential choices faced by other nations, including the US. It suggests that governments are likely to choose inflation over the alternative of a Great Depression, leading to further money printing and asset inflation. The narrator predicts a 'Quantum wave leap' in technology and asset prices, inviting viewers to join a live discussion to understand the investment strategies for navigating this predicted economic landscape.
Mindmap
Keywords
💡Bank of Japan
💡Federal Reserve
💡Interest Rates
💡Global Markets
💡Carry Trade
💡Monetary Policy
💡Debt to GDP Ratio
💡Inflation
💡Asset Prices
💡Quantitative Easing
💡Investing Strategies
Highlights
Japan's unexpected interest rate hike challenges the Federal Reserve's dominance and causes global market chaos.
The battle between central banks can rapidly change asset prices in today's financialized world.
Japan's strategic move is about redefining global financial power, not just saving their currency.
The video explores the economic chess game being played on a global scale.
Mark Moss, with decades of experience, provides insights on navigating turbulent markets.
Japan's desperate move to raise interest rates was a surprise to the world.
Japan has been in a state of stagflation, known as the 'Lost Decades,' with no market growth.
The impossible trilemma of free capital flow, fixed exchange rate, and independent monetary policy.
Japan's situation exemplifies the struggle between global monetary order and national policy independence.
The Federal Reserve's aggressive rate hikes have a significant impact on global currency values.
Japan's Yen has been plunging against the US Dollar, causing panic in the markets.
The concept of the carry trade and its role in the current financial crisis.
Japan's $2 trillion carry trade and the risks it poses to the global market.
The potential consequences of Japan normalizing its interest rates with the Federal Reserve.
The dilemma of choosing between a currency crisis and a deflationary crisis.
The potential for a 'Quantum Wave' in technology and asset prices due to inflationary policies.
Mark Moss offers a live analysis of market charts and investment strategies for the upcoming economic changes.
Transcripts
the bank of Japan versus the Federal
Reserve and how their battle crashed the
market and of course what this means for
you now in today's over financialized
world the battle between major central
banks can change the asset prices in the
blink of an eye and today the stakes
have never been higher Japan and the
Federal Reserve are locked in a battle
that sent shock waves through the entire
Global markets and the aftermath could
change everything now what happened well
just a few days ago Japan took an
unexpected and a very bold St step that
uh nobody thought that they could or
that they would do this and basically
they raised interest rates Against All
Odds now this was a direct challenge to
the federal reserve's dominance and has
thrown markets into complete chaos but
why did they do it and how does this
impact you now in this video we're going
to dive deep into the economic chess
game that's being played on a global
scale we're going to look at how Japan's
strategic move against the FED isn't
just about saving their currency it's
about redefining Global Financial power
we're going to look at the hidden
strategies that Traders around the world
were using and how they're all now
unraveling and of course what all this
means for your Investments and your
financial future now having this
information is going to make sure that
you're ready to capitalize on the risk
and the opportunities at play and you
know if you want to protect and grow
your wealth which who doesn't so let's
go real quick if you're new to the
channel my name is Mark moss and I've
been investing my own money in these
turbulent markets for decades now you
know the same smooth Seas never made a
skilled sailor well I've swim in the
most turbulent Waters now today on top
of making you know these investing
educational videos and coaching
thousands of investors on navigating
these markets I'm also a partner in a
global hedge fund and this morning we
are really busy understanding all of
this and of course making the
corresponding moves so you're going to
get the research fresh right now so you
can go make the same moves that you need
to make as well all right let's get into
this all right so are talking about
Japan's desperation Japan's unexpected
move now we talked about sort of This
Global Supremacy over monetary order and
really when we think about this we have
to understand that there are just well
there's central banks and then there's
major central banks so there's I don't
know 160 170 central banks but there's
uh four major central banks and they are
of course the Federal Reserve the United
States the top of the Heap right uh the
reserve currency of the world then below
that we have uh the bank of Japan which
we're talking about here we have the
east B the European Central Bank and we
have the pboc we have China right so
those are the major central banks now
the dollar is the reserve currency of
the world and so the FED sort of drives
the market but not every country likes
that so there's this battle for
Supremacy we're going to talk about that
and they did a desperate move now when I
say desperate they did something that
nobody thought was possible basically
Japan has been the last couple decades
of what we call stagflation the Lost
decades as they call it in Japan where
basically the markets crashed everything
crashed and they haven't been able to
get any growth they've had no inflation
in the market now so Japan had rates
basically at zero as a matter of fact
they had rates negative for a really
long period of time just recently we're
going to go through this but just
recently they were to to get them back
up to zero and a little bit above zero
nobody thought they could actually rais
them and they did they caught everybody
off guard and that's what's causing the
whole world to panic right now and what
we can see here we can see it in this
chart right here you can see how big of
a panic how big of an Abrupt move this
is so the the Japanese Yin priced in US
dollar had been going down down down
down down down down for a long period of
time and out of nowhere look at this it
just took off it's up 15% when you're
looking at currencies that is a massive
move I know if you're used to looking at
Bitcoin 14% is nothing that is a big
deal for the Japanese Yen and we can
really see how big of a move this was
made specifically by Japan obviously not
just from this chart right here but if
we look at the Dixie chart so the Dixie
the dollar Index is basically meur
measuring the dollar against a basket of
currencies so when we look at the dollar
overall of course the dollar goes up and
down everything's trading against each
other and we can see that the dollar the
the dollar Index the Dixie has dropped
but it's down 2% now that's a pretty big
candle two two big candles in a row
right here uh but you can see it's sort
of within this range so it all came from
Japan like I said In This Very desperate
attempt that they have all right now
understanding The Impossible situation
that Japan is in means that you have to
understand the impossible trilemma now a
trilemma is different than a dilemma a
dilemma means that you have you know to
choose between one or the other trilemma
means you have to choose two over one
and so the impossible dilemma that not
just Bank of Japan has but every country
with a central bank and policy has is
these three things number one free flow
of capital so now a country wants to
have capital accounts Capital markets
they want to attract capital investment
Capital businesses to be there people to
invest in the country but then people
also need to get money out of the
country this is one of the problems with
China China's like a black hole where
money can come in assets come in but it
can never leave which is why people
don't want to invest there so you need
to have a free flow of capital in and
out but you also want to have a fixed
exchange rate and then third you need
you want a country would want to have an
independent monetary policy meaning they
can adjust their monetary policy they
can tighten the ease whenever they want
the problem is that if you get two of
these you're going to get less of
another so for example if you want to
fix your exchange rate like what China
does and you want to have independent
monetary policy like China then you
can't have an open Capital account if
you want to have an open Capital account
and monetary policy then you can't have
a fixed exchange rate the market will
dictate what that is and so that's sort
of the situation that uh Japan has found
themsel in now why is that well uh well
first I want to say is that they want to
have an independent policy that's one of
the legs of the trilemma but independent
from who would be a question that that
I'd want to ask well independent from of
course the reserve currency of the world
so we can see in this chart right here
the reserve currency the US dollar makes
up
62% of foreign reserves so of course
it's going to dictate what the world
does and so Japan has been stuck in this
situation where they've been again sort
of at the whims of the United States uh
the the dollar and they want to change
this that's the tri limit that they've
been in but how can they try to get all
three get that proverbial free lunch and
that brings us to the next part and that
is that the FED has been fighting back
now the FED isn't really so much
fighting back against Japan or or China
maybe they are a little bit but really
the FED just wants to control its own
independent monetary policy so the FED
can set the interest rates although
that's a whole another topic if you want
me to make a video on that let me know
but really the FED is sort of adjusting
to what the market wants the rates to be
that's a whole different topic uh but
the FED does or is independent and of
course the United States has open
capital accounts but the problem is that
again because the FED has the dollar
which is 62% of the world's Reserve
currency it's dictating the rest of the
market so what happened is if you
remember the FED started hiking rates
remember that uh we were on this
monetary easing cycle for so long rates
had been basically at zero since like
2008 they went up a little bit came back
down and was it uh November October of
2021 the FED announced they were going
to start raising rates uh then about
March March of 2022 they went on the
fastest most aggressive rate hiking
cycle in history now what does that mean
for us well if we look at this chart
right here we can look at Japan we can
see in this chart right here this is the
Japanese Yen again priced in US Dollars
and what I'm showing you in this box
right here is that the price the
stability between the Yen and the dollar
had been pretty stable this is about I
think about 2015 right here to 2022 yeah
2015 to 2022 and it had remained very
stable in this box but right here where
I put this red arrow is drum roll please
it's March of 2022 it's when the FED
started going on that aggressive rate
hiking cycle and so as they started
raising rates in the US it started
making the dollar much stronger and it
plunged the Japanese Euro all the way
down and it plunged the Japanese Yen all
the way down now this blip right here is
where we're at today that's what we're
talking about but what's important to
understand is that this had been a very
stable monetary policy for Japan during
this whole period and during this period
about a seven-year period people got
lulled to sleep they thought that Japan
would never changeed Japan would just
stay in this Zone but of course as the
Yen started to
plunge then it opened up another trade a
trade that we're going to talk about
right now I'm going to break it down and
then you can see this pop right here but
what happened happened during that time
the yin was plunging it was getting
weaker and weaker and weaker now I like
to use uh if you remember when FTX The
cryptocurrency Exchange collapsed I did
several videos on that and I used uh the
fall of FTX sort of as a proxy to
understand what's going on in Japan so
let me revive that story here real quick
so you can understand this so you
remember FTX was a cryptocurrency
exchange and if you remember what
happened during that time I made a video
about it where they had their own token
and the problem is that they used use
that token for collateral for a lot more
debt and to buy other things but the
problem is is that their token started
to drop in value and so what FTX was
doing is selling all their other assets
and buying their token in the market to
try to prop up that token eventually CZ
the head of binance said hey that
token's not worth it we're going to sell
that token we don't want it anymore and
then it started plunging rapidly FTX was
selling everything they could to try to
buy it at Market to keep it from falling
but they couldn't nobody wanted the
token and this is exactly what's going
on with Japan the Japan token stayed
relatively stable but once the FED
started to raise rates the Japanese
token started plunging now Japan has
been aggressively selling anything they
can to buy their token the Japanese yen
to prop it up and that's where we're at
now we can see this happening in real
time the Yen weakness persists despite
Tokyo's $2 billion intervention so the
the Japanese government is
selling us treasuries selling whatever
they can and buying billions tens of
billions of dollars of their own
currency at Market trying to prop it up
but the problem is just like with the
fall of FTX nobody really wants it and
so we can see it plunging plunging
plunging as a matter of fact right here
so it went up and came down this is the
first intervention shortly after ueda
the press conference that saw Japanese
rip to 160 so they did an intervention
it went up temporarily it worked for a
minute and then it plunged down again
and then they did another intervention
they got it back up again but it plunged
again so no matter how much they
intervene it has like a sugar rush it it
gets up really quickly and then it just
falls back down sort of like where FTX
found themselves but here's the problem
they realize this is the problem and
they realize that they're going to have
to do something drastic in order to get
this to be fixed so the yin is under
pressure even as Japan steps up its
verbal warning so then Japan's like well
we're dumping tens of billions of
dollars we can get it temporarily the
problem is is all these short sellers
these short sellers are piling in and
pushing the price down so what we're
going to do Japan said they're ready now
a verbal warning they're ready to take
action on currency if needed so this is
after this was in June 23rd it's about a
month ago month a little over a month
ago they're ready to take action on
currency if needed what does that mean
well any action that they have to take
they've been trying to buy backup and
they have about $1.2 trillion of assets
they could sell to continue to prop up
their currency but they could also just
try to shake out all the people that
were shorting the market now what do we
mean by shorting the market this is what
you probably been hearing about which is
called the carry trade and so the carry
trade was opened up because Japan was
stuck in this trilemma situation and so
basically the shorts had opened up a
carry trade of about $2
trillion again against the Japanese Yen
they were selling it short I'm going to
break down how this works for you and
what we can see is that that created a
massive risk for the market as a matter
of fact it says is the Japanese carry
trade the next big risk in the market
this was in January people have been
talking about this we've been doing
videos on this for a long time this has
been a big risk Japan's government is
engaged in a massive $ trillion Carriage
rate I mean imagine how massive that is
for a small country like Pan um it says
here that this could bring unexpected
risks if the Central Bank tightens
policy H which is exactly what just
happened so the Japanese couldn't buy
enough of their token to prop it up all
these short sellers were selling it
short putting that downward pressure
like when CZ from binance said he was
going to sell the FTX token and Japan's
trying to prop it up and they're like
well we may have to do something
unexpected unexpected like what well
this in January says right here it could
bring unexpected risk if the Central
Bank tightens policies and that's
exactly what happened we can see right
here that the Central Bank of of Japan
started to do that so this is going back
to 2008 right here the red line is CPI
the yellow line is the Japanese Central
bank's interest rate policy and you can
see that it was basically flatlined from
2008 it went down into negative
territory right here around 2016 and
it's remained in negative territory just
here in 2024 it got above positive
territory and now they raised it just
0.25% now to put this into perspective
the Federal Reserve of the United States
raise rates Five Points this is only a
quarter of one point and look how much
damage this has done all right so that's
exactly what happened they raised rates
and got unexpected results let me show
you how this carry trade works and why
this matters so here's how the car carry
trade works it's basically Arbitrage
what this means is that in the US market
us treasuries let's say that we can earn
5% okay over here in
Japan as I just showed you rates were
zero so let's say that in Japan I could
borrow for let's say
0.8% so I go borrow money in Japan for
0.8% I bring it over to the United
States and I park it in treasuries and I
make the difference 5% minus
0.8 or I put it into the US Stock Market
and let's say I put in the S&P 500 I put
in the mag SS I put in Nvidia and now
I'm making 12 15 20% minus the eight and
so more and more money kept getting
borrowed selling the Yen short and it
all that money was Finding its way into
stronger markets mostly into the United
States in the stock market into Nvidia
into us treasuries it's been great but
here's the problem a lot of this money
was put in there on margin so that means
that they would borrow $1,000 from here
and they would take it over here and
they would buy let's say $5,000 worth of
stuff or maybe maybe more depends on
what their credit is maybe $10,000 worth
of stuff but the problem is is this
unwinds very quickly for two reasons as
long as this Japanese rate kept getting
lower lower lower lower lower lower
everything was great right this debt
kept getting cheaper cheaper cheaper
more money kept coming over and these
assets went higher higher higher the
problem is the unexpected results when
Japan raised the rates and only by
raising them only
0.25% this whole thing started to unwind
when these rates went up all of a sudden
the interest that was owed went up and
when that happened some of this had to
start selling off to now pay for this
and as this started to sell off the
asset prices started to go down as the
asset prices to go down started to go
down on stuff that was on margin then
the margins were called and they had to
post more collateral to post more
collateral they had to sell more when
they sold more prices went down even
more which then mean more margin costs
means they had to sell more to post more
collateral and all the while they were
selling this creating this downward
pressure this was getting more and more
expensive and this whole thing started
to wind down now this was great for so
long because for 20 years they kept
rates at zero and they just continue to
stay low and get lower lower lower but
again the UN expected shift to try to
shake off these short sellers put the
entire Market into a tail spin so that's
where we're at now confronting Godzilla
where do we go from here all right the
elephant in the room if you will we'll
call it Godzilla because it's Japan so
where do we go from here what happens
can Japan really continue to raise their
rates what happens to the US markets
what happens to the four central banks
that are now fighting against each other
well what Japan is doing is somewhat
necess AR but it comes with a very steep
cost so they have all these short
sellers that have piled in pushing the
currency down and doing this carry trade
over into the United States they need to
shake them off they need to get rates
back into positive territory but the
problem is it comes at a steep cost it
comes at the cost of wrecking the global
markets the bigger problem is that Japan
is one of the most indebted nations in
the world with a
263 debt to Genie P now put that in
comparison the US is about somewhere in
the 120% range they're at 263 and not
just the government the private debt is
120% of debt to GDP so the problem is is
that they want to sort of normalize
their policy with the Federal
Reserve but the problem is is that the
FED is at you know 5% and they're at
0.25 they may have to hike another 13 14
depends on how fast they hike but 1 more
times to even get anywhere normalized
with the fed and if it the whole world
is melting down over a quarter point
hike what do you think happens if they
go with a three four five% hike now the
bigger problem is this right now
currently if they were to normalize the
policy with the FED that means they
would be paying
133% of their gross domestic product of
their GDP just for interest on the debt
now to put this into perspective the
United States as you've seen I've done
many videos on this uh the interest on
the debt has gone up parabolic and as a
matter of fact in the United States
we're now spending a trillion dollars
more than a trillion dollars just on the
interest on the debt and the interest on
the debt has now exceeded the cost that
the US spends on the US military which
of course the US military spends more
than the next 10 Nations combined but
even as crazy as that number is it's
about 3% of GDP so for Japan to try to
do what's necessary and try to normalize
policy they'd be spending
133% problem is they can't do that and
so they want to confront Godzilla but
Godzilla might just be too big for them
so which path are they going to take are
they going to fight Godzilla or they
just going to go back into their hole
and really we can see that the entire
system is buckling as they weigh these
two decisions so the choices are one do
we have a currency crisis do we continue
to let the Yen just fall plunge plunge
plunge plunge plunge or do we try to
save the currency fight off the short
Sellers and have a deflationary crisis
those are are choices those are the
sides of the coin heads or tails they
can choose what they
want not unlike what FTX had to choose
and not unlike which the us is going to
have to choose at some point the us is
going to have to choose right now would
we rather have another Great Depression
a deflationary crash where jobs are
wiped out people are homeless and on
food lines that the stock market's wiped
out the real estate Market's wiped out
we go into another you know 20year Great
Depression period or do we have a great
debasement where let's just go print
trillions more dollars and let's just
put asset assets
Skyhigh this is the same decision the US
is in which is the same decision that
Japan is in do the markets crash or do
taxes crash you see if the markets crash
if we choose option one a Great
Depression then then what happens well
nobody's working and so with nobody
working then there's no taxes being paid
if the stock market crashes if the real
estate market crashes then there's no
capital gains taxes and then there's no
taxes to the government now the
government's already running
multi-trillion dollar deficits today if
we go into just even a garden variety
recession we'd expect to see tax
receipts plunge somewhere between 12 to
15% now the treasury just announced a
couple weeks ago that just the borrowing
for the rest of this year which is not
even half left they need another 1.7
trillion just for this year so if taxes
Garden variety recession crashed by 15%
they have to borrow even more if we have
a Great Depression style how will the
government survive now what's going to
happen obviously would be that they
would have to continue printing money
for the government and more stimulus
more welfare and more importantly to
continue to run that those deficits all
of that money printing will be highly
inflationary
so you know I think about uh 2020
remember 2020 and what happened in 2020
well the whole country was shut down not
because the recession but because the
government forced to shut down the
government then was forced to inject
money print stimulus money and injected
directly in the economy trillions of
dollars and what happened homes went up
by 50% stocks went up by 50% Bitcoin
went to the moon so did your gasoline
and so did your steak and so did your
houses as well and so I think about 2020
and I think this is where we're going
now in my opinion well it's not my
opinion based off a factual observation
if we look at every government in the
world today and sort of every uh
experiment in the past every government
in the past there hasn't been an
experiment that I've seen where a nation
decided Well boys pack it in it was a
good run while we had it let's just shut
her down not when there's still ink in
the money printer and so I believe that
they'll turn that money printer back on
and we'll print it skyh High they'll
always choose a currency crisis and a a
great basement over the alternative and
that is inflation now the thing about
when this inflation shoots Sky High is
it doesn't push all asset prices up
evenly for example the NASDAQ went up by
about uh double what the S&P 500 did
Bitcoin went up about 5
600% on top of that right and so there's
different ways that these different
assets interact now if you'd like to see
the playbook for this we're in the
middle of what I'm calling a qwave a
Quantum wave leap in technology and this
inflation that we're about to see thrust
into the market is going to make 2020
look like chump change and it's going to
drive asset prices to highs we've never
imagined come hang out with me live I
got about 20 or 30 sh charts that I want
to show you so you can understand how
each one of these Cycles is very
predictable and it lays out exactly what
assets we should invest to I call it the
investing black hole because there's
really no other place you put your money
I'm going to give you the top five
assets I'm checking out it's free
there's a link down below if you want to
come hang out and uh hang out with me
I'll answer all your questions live to
to make sure you have it but either way
this is what's going on in Japan it's uh
just like FTX was an example of Japan
Japan is an example of the rest of the
world we're really witnessing this in
real time and the entire world one by
one the great milkshake theory is going
to see each Nation forced to choose one
of these three things and as I said
every example in current and past
history shows which path they take all
right let me know what you think in the
comments down below thumbs up if you
like this video if you don't you can
give me a thumbs down that's okay but at
least tell me why in the comments down
below subscribe if you're not already
subscribed and that's what I got all
right to your success I'm out
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