RE: New Interview: Same RED ALERT Signals as in 2008 and Dot-Com Bubble | Gregory Mannarino
Great interview well worth the listen. In my opinion with this one, once again you are spot on. I will add this perspective. The red flashing signals are real and should be watched very closely; but they are really more of a symptom of a deeper underlying disease in the global monitary and economic system. Our fiat economic and monitary system is totally based upon debt. The global debt based systems operates like this. Privately owned central banks like the European Central Bank, the Central Bank of Japan, and our own Federal Reserve Bank to name a few derive their livelyhood from lending money and collecting interest on that money that they create out of thin air. As they create more money into existance some in actual paper currencies and other just by typing numbers into a computer system the value of each of those currencies is diluted with each new unit of currency created. That means for the central banks to derive the same amount of income they must lend out even more money that they create out of thin air or raise interest rates. This cycle goes on and on until the whole system eventually can no longer sustain itsself. It is like a snake eating it's tail. If you look at the history of fiat monitary systems they usually last 40 to 50 years before the debt bubble grows so large it destroys the system and a new system has to be put in place to replace the old broken one.The bankers usually have a big war or some other incident to blame the collapse upon and distract the population from understanding what really just happened to them. Well the current fiat monitary system has been going for over 100 years now and has the biggest debt bubble in the history of the world.
https://born2invest.com/articles/global-debt-climbs-237-t)
In 2008 the system reached a critical point. Liquidity was being drawn out of the global markets and banks at such a rate that if the US Congress at the expense of the US Taxpayers had not created 29 trillion dollars worth of new debt and given the money to banks and corporations, within hours the whole system would have collapsed. They really did not fix anything in 2008 with the bailout. They just papered over the problem and in fact made it worse. Then they passed the Dod Frank Act which said in future times of liquidity crisis that before a government bailout can happen that the money held for depositors at the bank must be bailed in to meet obligations and that all derivative obligations must be satisfied before all other obligations. You might ask what is a derivative. A derivative is a contract making a bet to hedge against a financial event such as a rise or decline in interest rates or commodity prices or default on held debt instruments to name a few that is made in exchange for one party receiving cash up front in exchange for them promising to cover losses resulting from the financial event for the other party if the event happens. There are literally quadrillion of dollars in derivative contracts that have been issued between financial institutions. It just takes the right event to trigger a dominoe effect that could collapse the entire derivative market and the related obligated financial institutions. A bailout of that size in my opinion would never be allowed by congress. Here is some information about one of the biggest threats to the system that is presently looming. Deutsche Bank is one of the largest financial institutions in the world? Here is what the International Monitary Fund has to say about Deutsche Bank. Deutsche Bank: World's most dangerous bank?
http://www.bbc.com/news/business-36723034
Deutsche Bank had a crisis a couple of years ago and was bailed out by China. Now they are in financial trouble again and They face a potential downgrade by Standard and Poor's This month.
Deutsche Bank has a market cap of about 60 billion (with a B), Dollars but is on the hook for 50 to 60 Trillion (With a T) Dollars in derivatives.
Things are not looking very good for Deutsche Bank and it could potentially be the first dominoe to fall. No entity or government will be willing to cover the 60 Trillion dollar derivative exposure of Deutsche Bank. The derivatives associated with Deutsche Bank are cross collateralized with many banks world wide, Citi, Bank of America, HSBC, just to name a few. It has potential to bring the whole global monitary system down. Warren Buffett once called derivatives "financial weapons of mass destruction.