10/04/2024

The USA is in a situation that do it will die, don't do it will die

 Besides weapons, the USA is the biggest proliferator of propaganda, the biggest cause of inflation with its unlimited printing of toilet papers which it exported to the rest of the world together with its inflation.

Now the world is wising up. USA Treasuries are no longer the preferred choice of investment with the cutting of rates. That is why the US$ is weakening against most other currencies. Over the last two or three years they had to increase rate of returns to attract investors into treasuries. That is bottoming out with the rate cuts to save the economy.

The actions taken against Russia by seizing its assets is the final nail in the coffin. China is selling Treasuries like hot cakes. Even Japan, probably arm twisted to buy over the years, is also dumping Treasuries. The only support comes from the Anglo-Saxons, not all actually, with UK taking up the lion's share. They have to help to preserve the US$ hegemony to prevent its collapse.

But this cannot go on forever with spiraling debts. Most of the US$35 trillion debt are said to be held by USA entities and citizens. The collapse of the system will be catastrophic for US citizens itself. Pension funds that invested huge sums of their bounty in Treasuries and USA debts will collapse, leaving the pensioners to eat grass. Banks will collapse, big or small, as they also have huge investments in Treasuries and USA debts in their books. And what will this mean for US citizens as well.

It is therefore unthinkable for the USA to default on its debts. But default it will. It is only a question of time when the jugglers, the Fed and Treasury, cannot find an answer to prevent the default any longer. They have kicked the can down the road far enough. To save the USA economy, they are cutting rates hoping to energize the system. If Wall Street is reported to be doing so well and the stock market rising to records every day, indicating a booming economy, why is there a need to cut rates. Something is not right.

Anonymous

1 comment:

Anonymous said...

Empires in their final stage of destruction always behave in desperate ways. The USA is no exception. The only exception is that it is resorting to 'crash and burn' tactics. To be more precise the USA is adopting a 'scorched earth' policy. It is starting wars and conflicts around the world, hoping to delay its demise.

There is no turning back for the USA. It has gone too far leveraging on its US$ hegemony and unrestrained printing of toilet papers and weaponizing the US$.

There is no possible way of turning back on its massive debts that it now can never hope to repay. There is now a big problem with trying to sell its debts to countries like China and Japan, the latter facing its own battle of economic survival.

The war in Ukraine is not working out for the USA and NATO, with the new NATO chief still trying to flog a dying horse by telling the world that Kyiv must prevail. He talks as if that is as simple as taking candy from a kid. He sounds as dumb as his predecessor.

Collapse of the US$ hegemony can be fast or gradual, but there is no way of preventing it. De-dollarization is gaining momentum and any attempt to sabotage it, using more sanctions or seizing of assets, will lead to a faster collapse of the US$ hegemony. Trump, if elected wants to target countries joining de-dollarization. That will really end the USA, with him as the 47th President. Trump was prophesied to be the 45th and last President of the USA. That did not happen but may yet happen as the 47th, with all his rhetoric and grandstanding.

As with all the miscalculations, raising tariffs to the sky is not going to do any good to the USA. It is cutting the nose to spite the face. Neither will a tech war against China going to work out well. The USA has to ask the pertinent question of who controls all the raw materials and supply chains in the tech industry and who provides the main market for such stuff like chips, smartphones and EVs.