The USA is facing martial law as an unprecedented financial collapse approaches due to increasing interest rates, financial blogger Michael Snyder has warned.
One reason Donald Trump sat beside Rothschild Banker Wilbur Ross and former Goldmann Sachs banker Steve Mnuchin when he launched a reckless missile attack from his private golf club was, no dubt, because the banksters and Trump know that the USA economy is heading for collapse, and they need to start a war or find a pretext to impose martial law to contain the resulting unrest.
Trump and his clique knows full well that there will be no period of prosperity. They have tricked the American people. The total amount of debt is now so huge that even a tiny increase in the interest rate has a devastating effect on the real economy and disposable income.
The only solution to America’s financial Armageddon is to switch over from the private creation of money to sovereign money and to issue debt free Treasury bills etc. But Trump and his bankster backers have taken this option off the table.
The decision by the Federal Reserve to increase interest rates directly on Fed funds, and also, indirectly by stopping quantative easing, will mean that Americans struggling with record amounts of debt will find themselves ruined. The debt death spiral of the Federal Government is also set to accelerate.
New credit will become unaffordable for consumers and companies as well as the government.
Snyder predicts that the stock market could see its value halved. Analysts expect the market for used cars to collapse by another 50% in the coming five years. Property prices could also collapse, especially in California.
Students have also accumulated record levels of student debt and 27% are already unable to service their debt.
Snyder anticpates social unrest, and martial law when the financial bubble finally bursts.
So anyone that tries to tell you that the U.S. economy is in good shape is simply not being honest with you.
But even though things don’t look great now, they are going to look far, far worse after the biggest debt bubble in human history bursts.
For example, what do you think that America will look like after half of all stock market wealth disappears? In a recent note to his clients, John P. Hussman stated that his team is projecting that by the end of this current market cycle “roughly half of U.S. equity market capitalization – $17 trillion in paper wealth – will simply vanish”.
And of course that projection lines up perfectly with what I have been saying for quite a while. In order for key measures of stock market valuation (such as CAPE, etc.) to return to their long-term averages, stocks are going to have to fall at least 40 to 50 percent from their current levels.
As this coming crisis unfolds, other asset classes will experience astounding downturns as well. This week, Morgan Stanley (one of the too big to fail banks) released a report that said that used car prices “could crash by up to 50%” over the next several years…
For months we’ve been talking about the massive lending bubble propping up the U.S. auto market. Now, noting many of the same concerns that we’ve highlighted repeatedly, Morgan Stanley’s auto team, led by Adam Jonas, has just issued a report detailing why they think used car prices could crash by up to 50% over the next 4-5 years.
Housing prices are primed for a major plunge as well. This is especially true on the west coast where tech money and foreign purchasers from Asia have pushed home values up to dizzying levels. Half a million dollars will be lucky to get you a “starter home” in San Francisco, and it was being reported that one poor techie living there was paying $1400 a month just to live in a closet. Many believe that some cities on the west coast will be quite fortunate if home values only go down by 50 percent during the coming crash.
Everywhere you look there are bubbles. In a recent piece, Daniel Lang pointed out some more of them…
Eric Rosengren, the president of the Federal Reserve Bank of Boston, recently made a startling tacit admission. We may be in the midst of yet another real estate bubble. Major financial institutions in this country are in possession of over $14 trillion worth of residential real estate loans. That’s well over $40,000 for every man woman and child in America.
Low interest rates have fueled a bubble in subprime auto loans, and that bubble appears to be reaching its limits. There are now over 1 million ordinary and subprime auto loans that are delinquent, a number that hasn’t been this high since 2009.
There is now well over a trillion dollars worth of student loan debt in this country; much of it owned by low income families. And there’s little hope that these students will ever see a return on their investment. That’s why at least 27% of student loans are in default. While more than one in four students are in default now, that number was one in nine a decade ago. And if current trends continue, there could be $3.3 trillion of student loan debt by the end of the next decade.