Global Markets Now On The Verge Of Total Panic & Meltdown

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What happened on Friday certainly suggests that something major could be just around the corner.  It is well known that a rise in interest rates beyond certain levels will lay naked the insolvency of governments around the world.

While we certainly do not relish the chaos that would result from a meltdown of the bond market, it will not come as a shock to those who have studied financial history.  It is always the result of the fiscal and monetary policies which have been irresponsibly pursued, whether well-intended or not.

There are no examples in history of any paper currency not culminating in a violent collapse.  None.  It has been tried by all of our ancestors throughout human history.  All examples resulted in failure.  The lesson never learned is that humans cannot be trusted with the ability to create money out out thin air.  The list of those who have come before us include the Mongols, Chinese, French, Germans, Romans, Hungarians, etc.  It is not about a particular culture or a period in time.  It just does not work.

If the carnage in the bond market continues next week, we could finally be at that moment where the system reacts chaotically and violently.  It is sad, but it is the predictable end to the financial path that was chosen in the mid-1960s.

For those who are dispirited by the action in the energy and precious metals markets, a true panic out of financial assets into so-called real assets will cause those markets to skyrocket when denominated in fiat currency.  Today was a warning that this moment might finally be at hand.