FAST FIVE: The Fed's Strong Dollar Policy: A Recipe For Systemic Implosion

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And this will be the mother of all recessions, as there is an historical and concomitant debt (and hence currency) crisis in every corner of the globe ($300T+) as well as every corner of the nation ($90T+), from the toxic corporate bond market and over-strapped households to a grotesquely bloated ($30T+) government debt market.

And since the US is too arrogant to fail/default (TAF), the Fed's only stupid choice left among a long history of stupid, will be a gold-boosting QE pivot.

It's only a matter of time, however, before foreign investors, nostalgic for the days of former US glory, realize that such glory is gone, and that the only way UST's will ever be “risk-free-return” is if the Fed prints more debased money to buy them, which is not Powell's current practice.

As yields in the EU rise as a result of its US “ally's” policies, the EU starts to quiver and shake, as this means the EU's interest rates rise too.

For now, the ball (or dollar) is in Powell's court, and he's got a weak serve.

Categories: ZH