Even if you approach the debt with a real solution, it’s almost impossible to follow through with it. As soon as we have a positive trajectory financially, the incentive is to bet that on more debt.
The system we’re currently using only works so long as we never get to where we are now.
Is there a fix? Other than defaulting on our debt somehow
I don’t think we can eliminate the debt in a way that matters without making a bigger mess of it. There simply isn’t a constructive way out that we’re interested in.
There isn’t a constructive way out that isn’t political suicide, because the answer is increasing taxes and cutting the budget only without all the fraud this time.
Put your money in hard assets. The powers that b recognize that there is no solving the debt crisis and stopped trying.
Ironically, Bessent should know that propping up a currency is a failing proposition, as he was with Soros when they shorted the British Pound because it was impossible to keep propping it up. All we’re doing by buying the Yen is buying time. Dalio is right, the writing is on the wall, and stupidly, Trump is doing everything he can to bring about collapse quickly. His tariffs shrink the economy, his deportations shrink the economy, and his war boosts inflation, alienates allies, and drives up energy costs. In my opinion, the collapse is coming sooner rather than later, likely at some point in 2027.
What to watch for: With respect to the mid-term elections, expect violence at polling places. Trump will deploy his ICE stasi to polling places to suppress turnout, and likely initiate violence. If Democrats still win majority control, expect claims of rigged elections and a refusal to swear in the winners. Make no mistake, this is a coup underway, and sadly, I expect it will likely succeed.
This of course will undermine confidence in the U.S. and the dollar, and cause rates on treasuries to reflect a significant risk premium. We’re already consistently above 5% on 30 year treasuries, and that will get much worse. With fewer buyers, the fed will be forced to buy treasuries, which is basically money printing. Also expect the fed to keep rates low. We’ll have a boom in stocks followed by a blowoff top and collapse that will make 1929 look quaint. Gold will go through the roof. I expect gold to make a new all-time high above $5600/oz this year, and top $20K/oz when the shit really hits the fan next year.
The worldwide economic malaise resulting from the collapse of the U.S. economy will have lasting repercussions, and we can expect world war to follow. It will take a generation or more for the U.S. to come back from this. We’re living in interesting times!
Trump bankrupting America is one way to top his casino bankruptcy.
Winning yet?
