🇯🇲 Marquin 🇵🇸

Look at the chart below. Most people scroll right past it because “bond yields” sound like something only bankers care about. But you should care also as the bond market is telling you the entire Western financial system is starting to break in real time. - Quick explanation for the lay person: A government bond is just an IOU. When you buy a 10-year bond, you’re lending the government money for 10 years. The “yield” is the interest rate they have to pay you to borrow that money. - When yields go UP, two things happen at once: The government has to pay a lot more interest on every new dollar/yen/euro it borrows. - All the old bonds that already exist become worth less, because nobody wants the old cheap interest when they can get higher interest now. Now look at the numbers: - Japan’s 10-year yield has jumped 49% just this year. Their 2-year and 5-year just hit 31-year highs. Japan is the most indebted major country on Earth. They owe more than twice their entire economy. For decades the Bank of Japan printed money like it was going out of style and forced yields down near zero so the government could keep borrowing cheap. That game is over. The market is now saying “we don’t believe you anymore.” - France +32%. Italy +29%. Germany +24%. The US +23%. Britain +20%. These aren’t small moves. These are the bond markets of the "richest" countries on the planet starting to revolt. - China is the only one going the other way. That’s not because China is a genius. It’s because they have capital controls and a completely different system. They don’t play by the same “free market” rules the West pretends to play by. Here’s the part they will never tell you on CNBC or Bloomberg or Handelsblatt: - These governments cannot pay this debt back with real money. They never intended to. The plan was always to print the difference and hope you didn’t notice your grocery bill going up. That’s why they spent 15 years keeping interest rates at zero. Zero rates = cheap debt = they think they can kick the can forever. - The can just hit the wall. If they let rates stay this high, interest payments will eat entire budgets. In the US, interest is already more expensive than the defense budget. In Japan it’s even worse relative to the size of their economy. They will not cut spending., EVER! Politicians never do once they taste the printing press. So they will print more. They will call it “quantitative easing” or “yield curve control” or “Treasury twist” or whatever new name they invent. Same thing: they create money out of thin air to buy their own bonds so yields don’t go even higher. - That newly printed money doesn’t stay in the bond market. It leaks into everything you buy. Food, rent, cars, energy. That’s inflation. That’s why your paycheck buys less every year even when they tell you inflation is “under control.” - This is the same movie we’ve been watching since 1971 when Nixon closed the gold window and the US dollar became pure paper no longer backed by gold. The United States, as issuer of the world reserve currency, got to print and force the rest of the world to eat the inflation. Japan, Europe, and the rest copied the model. Now the bill is coming due all at once. - They will not default. Default is politically impossible. They will inflate the debt away. That means the paper in your bank account, your pension, your government bonds ... all of it ... will buy less and less. - The only assets that cannot be printed are gold and silver, land as well. That’s why central banks have been buying gold hand over fist for three years while they tell you everything is fine. - This chart isn’t “interesting market data.” It’s the sound of the fiat system groaning, creaking like the Titantic before it broke in half. Japan is just the first one the market decided to slap in the face. The rest of the West is next. - We need an incremental return to some type of hard money standard, it's the only way. Until then, this is the path: higher yields ... more printing ... more inflation ... poorer people. We're all screwed together. So plan accordingly. A quick endnote ... there is one major nation unaffected by all of this. The name of the country starts with an R and ends with an A. Clues: Not Romania and not Rwanda. And a certain leader, his name begins with a P and ends with an N, he sees it coming too and is sticking and moving, playing for time. If he can hold out long enough, the world may just have a chance for real change.