The World Stands At Peak Debt

Peak Debt means that debt as measured by AGG, LAG, and BND has topped out, that is has reached a zenith. Debt came via our economic fathers, specifically, Milton Friedman, the Father of the floating currency regime, and Alan Greenspan, the Czar of credit liquidity, who oversaw such things as the use of HELOC loans, which enabled mortgage equity withdrawal so that the once existing middle class could enjoy such things as Botox injections, boob jobs, down payments for second homes in Arizona and Florida, ski trips to the mountains of Colorado, and on and on.

Yet there is an end to all things. And we are at the end of liquidity that has come from the twin spigots of investment liquidity, that being US Federal Reserve ZIRP policies, and easing, and that of investing long in carry trade investing.

It is the rise in the 30 Year Interest Rate, $TYX, and risk aversion to investing in the European Financial Institutions, EUFN, that will turn off the spigots, and push the world into great inflation and unwinding  carry trades.

Yes, we are very much at a pivot point, that is a tipping point, where we will be passing from the age of prosperity into the age of austerity and hardship.

Peak debt means less credit; and this is communicated by the topping out seen in the chart o Ford Motor Credit, FCZ,  and sub prime automobile lender Nicholas Financial, NICK.

Ben Bernanke in announcing QE 2 has established himself as the Global Seignior. The word Seignior comes from Old English, and means top dog banker who takes a cut, as he effects seigniorage. The chairman of the US Federal Reserve has risen to power through globalization and global corporatism, that is an ever-uniting of government and business. The US Federal Reserve is the premier global corporation; it is neither Federal, nor does it have much of any genuine, real, that is tangible reserves like gold or silver; the Federal Reserve is not part of the Federal Government, yet it is the United States central bank that is a private corporation. The Fed Chairman in announcing gave seigniorage to stocks, bonds, currencies and commodities in announcing QE 2. Yes the Fed Chairman gets a cut; it is called a salary.

Eventually, I believe that a Global Seignior, will institute unified regulation of banking globally, as referred to, in the James Politi and Gillian Tett Financial Times article, NY Fed Chief In Push For Global Bank Framework, and that the Seignior will oversee all matters of debt and credit, and implement a global currency system.

We are entering a beastly age. Global corporatism is rising to be the sovereign world government. It will be complemented by The Global Seignior, the world’s banker, and a Global Sovereign, that is the world ruler, as well ruling in ten regions of global governance as called for by the Club of Rome in 1974. Through globalization, there has been a loss of national sovereignty, for many, one is no longer a citizen of a sovereign nation state, rather one is a resident living in a region of global governance.

Perhaps one might enjoy my article A Leader Will Soon Emerge To Govern The World.


One Response to “The World Stands At Peak Debt”

  1. Dan Bandekow Says:

    I wrote about corporatism recently on my website.

    It all started to go down hill when Corporations became protected under the Bill of Rights and the 14th amendment as “Natural Born Citizens” this gives them the right the petition the government and all other rights of an individual citizen.

    It was not always like this, i go into much more detail in my article here:

    I take an early look at the history of corporations in America and give a few different examples from the modern era. I thought you might want to take a look at this. Thanks for the good read.

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