Daniel Lacalle on the Biggest Bubble of All

[@johnhupperts]

Dude has a clear understanding of the markets. Economist first, successful capitalist second. Lacalle is a great guy to listen to and learn from.

[@coletrain5667]

According to Martin Armstrong who claims to have personal contacts with many central bankers, the reason Yellen delayed raising rates is because she was being pressured from central bankers in Europe and Japan. The ECB can not compete with higher US rates due to the EU debt burden and smaller tax base, so they are in an extremely precarious situation. The ECB also does not have the political authority to print money like the Federal reserve does, and thus they are running on cash reserves alone. Armstrong said by the end of this year the ECB will be out of cash, and this will result in a political crisis in Europe and debate over whether to authorize the ECB to print money. Obviously Powell now feels the Fed must focus on domestic policy objectives like keeping pension funds alive and creating an interest rate cushion for any possible recession, and thus they are raising interest rates faster.

[@LisaMurphy]

Keeping pension funds alive? Didn't know that was part of the Fed's mandate, but in any case, how exactly is that going to happen if QT and interest hikes continue on track and cause a stock market downturn?

[@SpaceWalkTraveller]

Interesting comment. The ECB has been printing money with their own QE program. This is a quote taken from their website. The ECB started buying assets from commercial banks in March 2015 as part of its non-standard monetary policy measures. These asset purchases, also known as quantitative easing or QE, support economic growth across the euro area and help us return to inflation levels below, but close to, 2%. Note the BOJ has also been doing it. Nomi Prins has a good book called Collusion that goes into a lot of detail about it if you are interested in it.

[@LisaMurphy]

SpaceWalk, did you just return from outer space? I think you've been out a fairly long time by the sound of it.

[@nicosmind3]

Currently reading The Tragedy of the Euro by Philip Baggus. It's very good, and a quick read

[@kp-ce1uk]

Jeff Deist is peak self awareness

[@philipkruseman8437]

Great episode.

[@ramonbs6075]

Awesome interviews. Thx for the upload

[@SpaceWalkTraveller]

This was a very interesting interview. Thanks for the upload.

[@LisaMurphy]

I'm trying to understand what he's saying about the Fed's balance sheet. He's saying a lot but I'm not getting him. It seems to me that the Fed's balance sheet is just really a bailout sheet. They took bad assets off the banks and bought a lot of bonds from them all in an effort to prop them up, correct? This enabled the banks to lend money out they otherwise wouldn't have had, and make profits they didn't deserve to make. The Fed's balance sheet is a bailout scheme, and just distorts the natural markets in a very bad way. The Fed props up BAD actors. This is one of the reasons the Fed should not exist.

[@MrDaymien1]

Lisa , it was my take from the interview that the US FED balance sheet is a loan to the market, to push up asset prices . The Fed balance sheet is a loan from the future, but the debt is here now . But the futhet the Fed goes into debt the less growth in the future. So if the credit has been issued, the debt is here and the growth will slow because of rising rates the futures not looking great . How much more can people borrow , how much more can the government lend to people , are we just about to continually borrow ?

[@LisaMurphy]

Damien, don't you get the feeling this is a scheme that just doesn't make any sense whatsoever? I was rather astounded that the idea of putting bad assets on the Fed's balance sheet made sense to the Fed and Treasury. They may have propped up asset prices and real estate temporarily but what is the point in that? They've just made things worse. With interest rates creeping back up Real estate is already starting down again and it will probably collapse. The stock market is going to collapse then where will we be? I'm not an economic expert but it seems to me the people at the Fed and Treasury are completely and utterly delusional.

[@MrDaymien1]

Lisa it’s the politicians , they show no restrain and completely abuse the fiat monetary system that’s only backing is government future tax basically we are the collateral . That’s why the call for gold and accountability is carrying weight . Lisa I’m in Australia and the action of the FED effect our economy and more so monetary policy .

[@LisaMurphy]

I never hear anyone talk about the Treasury eventually giving US treasury holders a haircut. I hear a lot of people predicting hyperinflation but why would the Fed allow that to happen? We've Never had hyperinflation in the history of the Fed. And we're the reserve currency - hyperinflation would be disastrous to the world. So what are we going to do about all this debt - debt that we can't even afford to service anymore? Wouldn't a partial default be the least disastrous way out of this?

[@elijahschnake3863]

You think Americans are house obsessed? Come to Australia! Million dollars for a crack den.

[@ic4coldmilk516]

From that interview i got that its only matter of time when all collapse. They only putting bandage on bandage. And when one bubble collapse they all will.

[@makkusuXmax]

this is great

[@HeavyMetalPedal]

Excellent points and overall lesson of the global economy. USA must use this time to build real manufacturing that produces a required commodity for the future while the market has capital to invest.

[@felinskiroman]

beautiful

[@shosugino6716]

There is no substitute for petroleum. And the only way to buy it is with US dollars. Europe is perfectly free to compete with petrodollars.

[@mrzack888]

National debt = private sector savings

[@michaelbond781]

Then why is the dollar not at least on par with the Euro? Is it pure manipulation on the part of the Fed utilizing the options market?

[@symbiot5984]

$21 trillion missing ? explain that.

[@kw5992]

Bitcoin

[@EgorSebastianBach]

Gold

[@gentlemanspeculator]

Fine, but also inflated if sovereign debt is in a bubble.

[@Clarc115]

Lincoln instructs, labor is the source of all value, 'If not for Labor their would be no capital'. The dangerous debt based monetarism we are listening to is a failure for socializing the rigged 'markets' loses, and ignoring the population's physical economy, only interested in interest rates, yields, margins, arbitrage, etc. The US 'debt' represents what the US Treasury and the Fed gave to Wall St. It was a serious omission not to mention that Bernanke threatened the United States if the TBTF banker-speculators were not bailed out. It is just as dangerous to represent here that the debt is a legitimate debt upon a sovereign and its citizenry. The US can only pay its legitimate debts. The abuse and debasement of the Federal Reserve Note by the investor class must be confronted. Wall St. must be noticed it is not the Creditor of the United States, it is the Debtor. So we have a problem with perception and values. Austrian economics, antithetical to the Carey/List described American system of political economy, has demanded high unemployment, low wages, a low tech economy, supported by a slave-labor driven global supply chain, leaving the American nation with a poor and powerless workforce. This subversion of American national, physical economy priorities, undermines the reality we struggle to survive in, the imperatives of the population's existential system, the economy, are ignored and no effort is expended to discover and quantify the non-economic and/or parasitical activity of the investors, usurers and speculators that have royal prerogatives in this nation and the trans-Atlantic system generally. US political power must retrieve the lost, unaccounted for, and Stolen $Trillions. The US Treasury, the Federal Reserve Bank, the Wall St. system, must be reorganized. Wall St. must become a Public Utility. The Fed must be transitioned into a Public Bank system, fund the 50 states, infrastructure, and industry in support of the economy platform, the Redevelopment of North America, that can beat back the Wall St. directed Greatest Depression upon us now. Millions of lives are at stake. We're wasting time. Contact your political representatives. Contact the President.