The great debt crash

[errolanderson]

Another key recession indicator ocean freight. Global commodity price deflation now hitting hard. The Baltic Dry index is a key indicator of dry bulk ocean movement and costs. This index is also an indicator of deflationary pressures impacting global commodity markets. Last Friday, this index lost 2% alone. For the 2nd quarter of 2023, the Baltic ocean dry freight index collapsed 21% in-value.

Deflationary price pressures across commodities now clearly accelerating which are being magnified by the debt crisis plus rising corporate bankruptcies. Brace for further auto industry and commercial real estate fallout; a bullseye for further devaluation and price cuts heading into 2nd half 2023. Money velocity has plunged (another recession indicator). Consumers putting away their wallets.

Central bankers appear not to watch any key commodity economic indicators for guidance.

[shtferbrains]

Pie in the sky is getting tougher to peddle.

[AlbertaFarmer5]

Pie in the sky is getting tougher to peddle.

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Could it be said that Ponzi schemes such as these aren't very sustainable with net outflows of capital?
Pun intended.

[jazz]

BRICS currency preview to be rolled out in August, gold commodity backed.

Watch the US fed and treasury flood the world with dollars to try and dilute this move.

I think errols wrong here. We are about to have a huge melt up. Debt be damned when the reserve currency is under threat.

[foragefarmer]

BRICS currency preview to be rolled out in August, gold commodity backed.

Watch the US fed and treasury flood the world with dollars to try and dilute this move.

I think errols wrong here. We are about to have a huge melt up. Debt be damned when the reserve currency is under threat.

Jazz, it's time for you to short the US$, and sell all your North American investments in order to be ready to buy BRICS currency when it hits the market.

It will be just like an IPO for you, getting in on the first day with all excitement that follows such offerings.

I know you've had a hard-on for this opportunity for a while now, make sure you act on it.

[AlbertaFarmer5]

BRICS currency preview to be rolled out in August, gold commodity backed.

Watch the US fed and treasury flood the world with dollars to try and dilute this move.

I think errols wrong here. We are about to have a huge melt up. Debt be damned when the reserve currency is under threat.

Can you explain your rationale, I'm not following why flooding the market with dollars would help. If anything wouldn't that expedite the flight from the dollar and make a gold backed currency even more appealing wouldn't it?

Or are you thinking the gold backed currency would be so strong that exporting nations wouldn't be competitive with such a strong currency vs a fiat that is being printed at will?

[Grahamp]

I love the BRICS idea but it won’t work. The US essentially defaulted on their gold backed paper in 1971. Think about what happened then. Do you think the BRIC countries are safer and more trustworthy than the US? Where would the Gold be stored? Whose vault? Do you think people will convert meaningful amounts of assets into a promissory note from China and Russia? It just won’t work.

[WiltonRanch]

I liken BRICS nations to the local group of reserves who went together to build a casino in the city. All fine and dandy. Great idea and successful business except none of them could get along and get their shit together. Built a gas station as well but has sat vacant unoccupied for 5 years. Of the 5 reserves only one is involved running the casino while the rest squabble. Remember BRICS was a brain fart of a couple American pundits who seen the potential of such nations to unsurp the American hegemony if they put their differences aside and got their acts together.

[jazz]

The proportion of financial transactions using USD has fallen from 68% to 54% in the last 10yrs. It’s already started.

If china wants to buy 100 cars of potash and wants to use yuan to settle are you really going to say no to that. Any one not comfortable with hold yuan can change the reserves to what ever currency they like after settlement. There is $10T a week done in FX every week.

BRICS will force the USD to repeg with a tangible asset and a revaluation of everything will occur. Maybe Ft Knox is full of gold.

The US has only 2 tools. The USD and it’s military and looks like it’s military is stalemated. So it will be the USD as the primary weapon for now. Yellen was just in china trying to get them to buy $850B in new issues. Imagine they will be making that same sell to many other countries including canada.

[biglentil]

I liken BRICS nations to the local group of reserves who went together to build a casino in the city. All fine and dandy. Great idea and successful business except none of them could get along and get their shit together. Built a gas station as well but has sat vacant unoccupied for 5 years. Of the 5 reserves only one is involved running the casino while the rest squabble. Remember BRICS was a brain fart of a couple American pundits who seen the potential of such nations to unsurp the American hegemony if they put their differences aside and got their acts together.

Want gizmos from China, a million tons of Urea from Russia, well you are going to need gold to convert into the new currency. Sell a load of grain to China, they will be glad to pay us back in our funny money. Do you see the problem?

[errolanderson]

Gold's enemy is a rapidly slowing China economy and deflation. Precious metals have been weak this summer. Gold prices (IMO) are again in-a-downtrend.

Deflation now hammering the auto industry. New vehicle prices appear down 10 to 20% depending on model. Used market down about 25%. Lot inventories swelling. And ill-thought out central banker policies continue to destroy the economy raising rates. Consumers totally tapped-out . . . .

U.S. corporate bankruptcies rocketing higher (up 70% in Q2). An asset price avalanche ahead . . . .

[biglentil]

I heard Gm has suspended production on new trucks for three weeks at the same time dealers bumbed the price up $3k. Heard the same thing from a chem retailer the other day about a major glyphosate manufacturer shuttering production to limit supply.

Even though M2 money supply is dropping fast, production is also dropping and more importantly faith in our institutions is collapsing. Without faith in the long term purchasing power of the fiat currency of a nation, that currency ends up being more valuable woven into hats and bowls like the oil rich Venezuela.

[jamesb]

I heard Gm has suspended production on new trucks for three weeks at the same time dealers bumbed the price up $3k. Heard the same thing from a chem retailer the other day about a major glyphosate manufacturer shuttering production to limit supply.

Even though M2 money supply is dropping fast, production is also dropping and more importantly faith in our institutions is collapsing. Without faith in the long term purchasing power of the fiat currency of a nation, that currency ends up being more valuable woven into hats and bowls like the oil rich Venezuela.

General Motors (GM) stated that it was temporarily halting the production of its full-size pickup trucks due to the global shortage of semiconductor chips. That's the reason IMO.
Glyphosate is finally getting back down to good prices. 540 product is under $ 7 per litre, a full 50 % less than a year ago. I cant see it getting any cheaper. We will be stocking up soon. My point is that man o man every one of us can read the same thing and come to completely different conclusions. It is so very easy to find "facts" to validate our position.

[biglentil]

General Motors (GM) stated that it was temporarily halting the production of its full-size pickup trucks due to the global shortage of semiconductor chips. That's the reason IMO.
Glyphosate is finally getting back down to good prices. 540 product is under $ 7 per litre, a full 50 % less than a year ago. I cant see it getting any cheaper. We will be stocking up soon. My point is that man o man every one of us can read the same thing and come to completely different conclusions. It is so very easy to find "facts" to validate our position.

Hmm I didn't state why GM stopped production, not sure how you could have come to the conclusion that I did. I also think glyphosate is nearing its lows.

[jamesb]

Hmm I didn't state why GM stopped production, not sure how you could have come to that conclusion that I did
. I also think glyphosate is nearing its lows.

I know you didn't say why, that's why I added what I had heard. Like I said before you can find pretty much what you want to see to fit any ones narrative. Cheers