As 2023 winds down, we want to summarize key concerns every American should be aware of as we roll into 2024. You must understand the risks, plan ahead, and protect your assets in any way possible.
Derivatives: In 2002, Berkshire Hathaway Chairman Warren Buffet compared derivatives to a ticking time bomb in our economic system. He explained, “We view them as time bombs, both for the parties that deal in them and the economic system”. A derivative is a financial contract that is tied to an underlying asset. An underlying asset could be a tranche of mortgage loans that an originating bank bundles up and sells as a security.
During the financial crises of 2007-2008, the problems began with the credit rating on the mortgage loans sold as securities to the investors. Many of these loans were stated loans that required no proof of income or assets. Once the economy turned and the borrowers could no longer make their payments, a wave of mortgage loan defaults occurred, which left the investors holding the mortgage-backed securities stuck with worthless paper. Their money was gone.
By the end of 2023, there will be roughly 250 TRILLION in derivate contracts. The old saying “Too Big to Fail” must surely remind Federal Reserve Chairman Jerome Powell of the global investment bank Lehman Brothers, whose collapse in 2008 was unthinkable.
Inflation: In July of 2021, President Joe Biden explained the inflation that we were experiencing was only “transitory”, a fancy word for temporary. At the time, the CPI (Consumer Price Index) was near 5.4%, and people were feeling inflation at the gas pumps and at the grocery store. By June of 2022, the CPI had reached 9.1%. Today, we have a CPI reading of 3.7% for all items and 4.1% less food and energy.
The pandemic has been cited as the major reason for the high inflation. The real culprit behind today’s inflation has more to do with government policy. In short, the printing presses run 24/7, with unnecessary government spending and high interest rates crushing the middle class. With the US National Debt (notice the US dollar to gold and silver ratio vs US dollar supply) fast approaching 34 trillion USD, the time is here to consider alternative ways to protect precious retirement dollars.
Former Federal Reserve Chairman Alan Greenspan once wrote: In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.
Banking Crises: A nationwide commercial banking crisis looms large, and yet, very few are concerned or talking about it. The fact of the matter is nearly 25% of office building loans will mature next year alone, and with higher rates and vacancies, many quietly believe we may see loan defaults which will affect many regional and national banks in 2024.
Many insiders are unconcerned, and believe this problem only concerns office buildings where so many people now office from their homes. A more likely scenario is not as optimistic.
- Industrial: At the rate our jobs and manufacturers have fled to places like China, there is a solid chance many of these companies will be fiscally unable to renew their loans because of the higher interest rates, thus becoming a huge problem for the banks.
- Retail: Part of the problem here is David vs Goliath. Not to mention the fact so many people now do their shopping online.
- Hotels: With higher gas prices, many Americans cannot afford to take vacations and travel like they could a few years ago. From the corporate side, meetings once held in fancy boardrooms, are now held in virtual boardrooms using modern technology like ZOOM.
On the flip side of all of this is the fact that warehouses, storage, and shipping facilities are going up like wildfire. In a nutshell, it is estimated that nearly 2 trillion in commercial loans could default over the next 24 months.
US Dollar: The strength of the US dollar remains high, and it is still the strongest currency known to mankind. Confidence in the US dollar and the Fed`s arrogant policies are a different story as Americans grow more weary of the dollar by the day. Outside of the US, there is wild speculation concerning the status of the US dollar as the global reserve currency, and its legitimacy. The question here is this: If the Federal Reserve Bank has printed trillions of dollars, why exactly is the US dollar so strong?
The Federal Reserves policy to curb inflation, is to raise interest rates. The more they raise interest rates, the stronger the dollar gets. The more they print and dilute, the higher the rates are going to go. And if the US dollar defaults or is rejected in the international community, we expect a new currency to be introduced immediately, and without warning. (see CBDC)
Treasury Secretary Janet Yellen is on record stating she would much rather see low unemployment than low interest rates. What this means: The US dollar will be strong your just going to need more of them to buy anything.
Politics: Maybe not since April 12th, 1861 when Confederate troops fired shots at Fort Sumter in South Carolina, have we seen our nation more divided. Washington DC politicians don’t seem to care and make decisions based on their wallets instead of their constituency. In short, DC is more corrupt than ever and framed perfectly by Oliver Anthony’s hit single, Rich Men North of Richmond.
The modern politician wants to control what you think, and control what you do. They’re gonna tax your money thats already been taxed. They’re gonna continue to flood our cities with people who have no right being here. Because of the dysfunction in DC, and its politicians, the world has become a very dangerous place. Our way of life and our freedoms will be tested more in 2024, than any other year since 1861 – guaranteed!
The enemy is no longer at the gate, the enemy is in our cities and our small towns! You can thank those politicians in Washington DC for the mess we’re in.
Global War: Albert Einstein once said, “I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones”. As the Chinese circle Taiwan with their ships and planes, Vladimir Putin contemplates making a nuclear decision. While barbaric terrorists murder babies, women and the elderly in Israel, The United States invites millions of people we do not know into our country.
Former Director of National Security John Ratcliffe said recently “we will have peace through strength, or weakness through chaos”. Unfortunately, the level of chaos in America has never been higher. Even during that fateful morning in September of 2001 when terrorist hijacked airplanes and killed thousands of Americans, we came together as a people. Today, our enemies know we would rather fight with each other than fight them, which makes 2024 a year that may live in infamy.
Conclusion: 2024 will be a year where we as Americans will be tested economically, politically, morally, and financially. Our survival as a nation and as a people will be determined by decisions we make as individuals. Through anti-American indoctrination we have lost our way. We must find our way while we still can. One thing is clear, a nation divided cannot stand. Buckle up America!
Scott Hage
Monetary Specialist
PrivateBullion.com
