Central Banks Have Broadcast What is About to Hit…
By Graham Summers
GoldSeek.com
Monday, 7 November 2016
The biggest problem for the financial markets is not stocks nor is it the economy.
It’s the Bond Bubble.
Globally the bond bubble is now over $199 trillion in size. The world taken as a whole is sporting a Debt to GDP ratio of over 250%.
This is a systemic issue.
Once the bond bubble became large enough, Governments themselves became insolvent. At that point, there were only three options:
1) Stop spending as much money.
2) Increase revenues (more on this shortly).
3) Make the debt loads easier to service.
Governments/ politicians will never push #1 because it is political suicide (the minute someone pushes for a budget cut the media and his/ her political opponents begin attacking the candidate for being “heartless” about some issue or other).
Option #2 is the so-called “growth” option. When Central Banks talk about focusing on “growth” what they’re really hoping to do is increase taxes (higher incomes, higher GDP growth=more tax money).
Remember, taxes=revenues for Governments. And revenues are what the Government uses to make debt payments. However, at some point, once you are deep enough in debt, the growth option becomes impossible.
The Rest…HERE
