Bonds Are Going Hyperbolic! Are You Ready For What's To Come?

Hey Dr Jays

If you took note of the 2008 economic crash you'll know what a devasting effect it had on the world, but ti also gave us BTC as Satoshi looked to provide an alternative. To save our current economy banks were bailed out by governments by printing massive amounts of new money in a stimulus package to save us from the impending doom of cripplinf debt.

What we didn't do its take steps to correct the situation and banks have simply continued to do what they've always done, which is prop up the world on debt. Now roughly one-quarter of the global debt market is trading at levels once thought improbable.

The economy is built on people leveraging their future through acquiring large purchases like homes or starting businesses and then paying that money back over time. As demand for money lowers, so do interest rates to make it attractive to make debt and less attractive to well, save money.

If central banks keep cutting rates — as the European Central Bank is expected to do in September — bond yields look likely to follow them lower. The old theory that zero would act as a floor for interest rates has been shattered. In Switzerland, rates are currently at minus 0.75 per cent.

Now we're sitting with a case that:

• Negative debt topped $15 Trillion today on Monday, up over $1 Trillion in two business days.
• Negative debt is now 27% of all developed country sovereign debt, a new record.
• Negative debt now 44% of of all developed countries excluding US sovereign debt.

Source: - Bloomberg

What does all this gobbledygook mean?

If nothing is done these bonds negative yields will be too much and investors will dump them and once that happens governments will be in the shitter. With no way to pay all they can do, is yep, print money and we will see hyperinflation across a number of sovereign economies.

If you think your local currency buys you nothing now, wait till you see what it buys you if this economy goes full titanic-tits up and sinks.

I don't want to be all doom and gloom because, hell I have fiat I live off of it and if it does go sideways naturally I'll be affected.

Seeing currencies devalue and negative interest rates would mean cash would take a beating as a store of value and while some may try to find a safe haven in gold not everyone will be able to buy or store some of their wealth in gold, it's well impractical for many of us.

So what could be the next best thing? Holding crypto may seem like a speculative asset now but who knows?

It could be a stroke of genius to hold some of your net worth in something that looks to be a better store of value than your current savings that could be hit with hyperinflation and negative interest rates in some parts of the world.

It looks like this financial system we have is slowly starting to show its true nature as a poisoned chalice and my only real concern is the unsuspecting people who have no protection against this downside. The honest guy who plays it safe bought a home, pays his taxes and works for a living, saves his money and pension, those are the ones who get nailed.

Sources:

• ft.com
• moneymaven.io

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