Collapsing Economies

Pakistan could run out of foreign exchange reserves in less than 2 months. Islamabad failed to reach a deal with IMF for a bailout. The political instability could further destabilize Pakistan. Will the battle for power spell Pakistan's collapse?

Pakistan has officially descended into civil war. PTI supporters ran riot in Islamabad on Wednesday. They torched vehicles & set trees on fire. Imran Khan has now set a 6-day deadline for Shehbaz Sharif. Where are things headed?

Every inflation wave is different, and this one won't be fixed by raising rates. This one is based on shortages and not a speculative boom. They don't want to admit that the lockdowns started the collapse in the supply chain. There is no economic understanding with politicians as they all operate with blinders.

We're going to see more unrest in Third World countries due to energy costs. People will vote from their recent experience. When Trump became elected, populism became the enemy. Politicians are threatened by nationalism. The truth is, most of them hate democracy. The heads of the E.U. are appointed and governments in that union are subservient. It doesn't really matter who gets elected. These people would love to impose a similar system here in North America.

The causes of hyperinflation are usually fairly complex. For Germany in 1922 they couldn't repay their reparations, so they confiscated 10 percent of everyone's assets for a bond. However, this action caused citizens to rapidly diversify out of the state currency. Usually, hyperinflations are the result of a loss of confidence. He describes how the capture of a Roman emperor created a loss of confidence in the government and began the debasing of the currency.

He discusses his model and how it's indicating a shift in the types of government from Republics to more direct democracies around 2032. Republics represent their own self-interest, and that eventually is their downfall. He expects another collapse around 2032.

Time Stamp References:
0:00 - Introduction
0:38 - Economic Confidence Model
8:40 - Malice or Stupidity?
10:20 - Power Cycles & Davos
16:05 - Debt & Owning Nothing
17:38 - Russia & Putin's Ratings
20:10 - Society & Religions
22:18 - Historic Hyperinflations
30:42 - The Problem with Debt
35:47 - MMT - The Road Ahead?
37:43 - Ukraine Outcome?
44:40 - Soros & China/Russia
50:00 - The Coming Shift
53:58 - CBDCs and Control
55:38 - Manias and Bubbles?
58:46 - The Gold Cycle & Assets
1:04:14 - Housing Markets
1:05:03 - Censorship
1:07:06 - Wrap Up

Talking Points From This Episode
- Inflationary pressures are being caused by supply chain disruptions.
- Expect further unrest due to energy costs.
- The historic causes of hyperinflations.
- Why governments will move from Republics to more direct democracies.

Emerging nations, including El Salvador, Ghana, Egypt, Tunisia and Pakistan, will be challenged with a historic cascade of defaults as a quarter-trillion-dollar pile of distressed debts exerts downward pressure on economies, Bloomberg is reporting.

“With the low-income countries, debt risks and debt crises are not hypothetical,” the World Bank’s Chief Economist Carmen Reinhart told the agency on Saturday. “We’re pretty much already there.”

Over the past six months, there’s reportedly been a doubling in the number of emerging markets with sovereign debt that trades at highly distressed levels, meaning yields that indicate investors believe default is a real possibility.

Sri Lanka has barely enough fuel to last one day – mediaREAD MORE: Sri Lanka has barely enough fuel to last one day – media
Another cause for major concern reportedly arises from a potential “domino effect” that commonly occurs when scared investors begin yanking money out of countries with economic problems.

In June, traders reportedly pulled $4 billion out of emerging-market bonds and stocks, marking a fourth straight month of outflows.

Probable defaults may be followed by political instability. Earlier this year, Sri Lanka was the first nation to stop paying its foreign bondholders, burdened by unwieldy food and fuel costs that fueled protests and political chaos.

“Populations suffering from high food prices and shortages of supplies can be a tinderbox for political instability,” Barclays has said, as quoted by Bloomberg.

www.rt.com/business/558718-emerging-economies-cascade-defaults

In China, a major financial crisis is unfolding. Chinese citizens in 86 cities are boycotting mortgage payments towards their homes. Chinese censors are erasing documents about this boycott.