Recession is Coming with James Lavish
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SHOW DESCRIPTION
James Lavish is a Bitcoin advocate and writer of the Informationist newsletter. In this interview, we discuss central banks' manipulation of the monetary system, the eye-melting bailouts to come, an inevitable credit event the Fed will be unable to rectify, why BRICS pressure doesn’t currently threaten the dollar, and how the US rejecting Bitcoin may lead to hyperbitcoinisation.
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Last month US Treasury yield curves witnessed their deepest inversion for over 40 years. This means holding bonds over the long term results in a lower return than shorter-duration contracts. It is a classic signal of a looming recession. It is the market expectation that future interest rates will be cut in order to stimulate an economy.
Whilst there are historical precedents for this situation, what sets the current paradigm apart is the level of unsustainable government debt: increasingly, countries are having to deal with debt levels in excess of their respective GDP. Whilst high inflation provides a way for reducing these burdens, such levels of inflation are politically damaging, and further, risk damaging economies and thereby tax income. Moreover, they risk damaging critical banking infrastructure.
Interest rates, as a result, will oscillate: they have accelerated to reduce rampant inflation, then, as is being forecast, they will need to be cut to stimulate a stagnant economy. All the while, commercial banks will be forced to search for yield. And some of these banks will get on the wrong side of the trade. Recent events have shown how quickly such situations can spiral out of control.
But, for how long can governments keep bailing out the banks? James Lavish, a leading market analyst, predicts a precarious situation. For a variety of reasons, the US can’t afford to go into a deep recession. As a result, James predicts a “face-melting print” by the Fed to avoid this situation. But, then, at some point the music will stop, and there could be a watershed credit event where the Fed won’t or can’t step in. The real question is, what comes after this event?
TIMESTAMPS
00:01:52: Introductions
00:02:40: Recession, yield curves, inflation, deflation, and GDP
00:19:28: Probability of a credit event
00:28:55: Preparing for recession, hyperinflation, and US debt-to-GDP
00:40:04: Personal asset portfolio
00:44:53: Employment in recession
00:50:44: BRICS, de-dollarisation, and gold reserves
01:08:23: Bitcoin as a reserve currency
01:20:53: Final comments
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SHOW NOTES
Connect with James:
On Twitter
The Informationist NewsLetter
Looking Glass education platform Website
Mentioned in the interview:
UK to be one of worst performing economies this year, predicts IMF - BBC, Apr 11th 2023
Follow The Money #2 - Inflation, The Hidden Tax - What Bitcoin Did, Dec 2022
Federal Funds Rate History 1990 to 2023 - Forbes, Mar 22nd 2023
G20 financial watchdog seeks to learn from latest banking turmoil - Reuters, Apr 12th 2023
Transcript of Chair Powell's Press Conference: March 22nd 2023 - The Federal Reserve Board
300 million jobs could be affected by latest wave of AI, says Goldman Sachs - CNN, Mar 29th 2023
A BRICS Currency Could Shake the Dollar's Dominance - Foreign Policy, Apr 24th 2023
China Settles First LNG Trade In Yuan - OilPrice.com, Mar 29th 2023
The BRICS Has Overtaken The G7 In Global GDP - Silk Road Briefing, Mar 27th 2023
Central banks bought the most gold on record last year, WGC says - Reuters, Feb 8th 2023
Dollar Dominance and the Rise of Nontraditional Reserve Currencies - IMF Blog, Jun 2022
Chinese Economic Officials Debate the Growing Threat of Debt - Bloomberg, Apr 8th 2023
China's Mysteriously Resilient Real Estate Prices - Bloomberg, mar 25th 2023
Russia Becomes 2nd Most Powerful Bitcoin Miner In The World - Bitcoin News.com, Apr 18th 2023
Russia considers accepting Bitcoin for oil and gas - BBC, Mar 2022
Can BRICS Topple the US Dollar? - James Lavish, The Informationist, Apr 16th 2023
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