{"id":1976,"date":"2022-06-06T12:44:07","date_gmt":"2022-06-06T12:44:07","guid":{"rendered":"https:\/\/sasquatchnewsonline.com\/?p=1976"},"modified":"2022-06-06T12:44:07","modified_gmt":"2022-06-06T12:44:07","slug":"economic-blowback-from-russian-sanctions","status":"publish","type":"post","link":"https:\/\/sasquatchnewsonline.com\/?p=1976","title":{"rendered":"Economic Blowback from Russian Sanctions"},"content":{"rendered":"
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Warren Strauss is a dear friend and a wise man in the world of finance and investment. He sent me the following the other day with no thought that I would publish it. I asked his permission and he gave me the greenlight.<\/div>\n<\/div>\n

We are in a brutal bear market.\u00a0If the last bear market of length was 2000-2002 (2 1\/2 years) , then this one has the makings of much worse. \u00a0How much worse is hard to say.<\/p>\n

Here are the reasons this is likely to be worse:
\n1. \u00a0Structural Hot Inflation<\/strong>\u2013this is the result of current US Domestic policy restricting mining, drilling for natural resources on US Federal land, off shore drilling, and inhibiting projects that facilitate movement and storage of oil, natural gas, and natural gas liquids, and mining for important minerals such as copper, platinum group metals, nickel, lithium. \u00a0I shouldn\u2019t have to explain this, but the policy limits production, which limits available supply, which causes prices to rise. \u00a0The remedy for high prices would be to reverse the restrictive mining policies, which has a snowball\u2019s chance in a hot climate somewhere. \u00a0The president is encouraging mining and drilling in other parts of the world (rules for thee, not for me) such as Venezuela, Mideast and bring those carbon fuels here which is pathetically hypocritical, and decreases our self reliance and independence and sends our citizens $ to foreign nations who are hostile to our nation.<\/p>\n

2. FED Policy Reversal<\/strong> The FED has been steadily reducing interest rates to zero since 2008 and further, has been creating funds to finance the explosion, yes explosion, of US Treasury debt from $4 Trillion in 2000 to $30 Trillion today. \u00a0This is almost irretrievable to repair. A. 2000 saw Fed Funds at 5%. \u00a0Today Fed Funds are 1.0%. \u00a0 B. 2000 saw Treasury 10 year at 8%, now the Treasury 10 year is 2.8% C. 2000 Treasury Debt to GDP ratio was 20%, today it is 120%<\/p>\n

3. \u00a0Global instability<\/strong>, from Eastern Europe and from China aggression into Hong Kong and Taiwan
\nA big problem for our self reliance and independence, is that a substantial amount of our useful technology is purchased from geographies where a hostile regime controls the factories. \u00a0This is the case in China itself, as well as Taiwan. \u00a0 There is a risk of supply limitations and a real risk that the hardware has imbedded code which can cause harm to users in the US and the western world, raising the risk of cyber insecurity (which is the prime use of cryptocurrency for ransom payments) as well as hard functional insecurity, such as the electric distribution grid, or the cellular grid, or the banking grid.
\nWorse, western policy reaction to Russia\u2019s special military operation in Ukraine has made the inflation worse by trying punish Russia with boycott policies and sanctions. \u00a0Now that EU allowed itself to become dependent on Russian energy, without Russian oil and gas, the EU is desperate to replace Russian supply, and energy transfer infrastructure takes several years to build out. \u00a0So EU is back to burning dirty energy such as coal, etc., and at a high cost. \u00a0This hurts the lower income class the most.
\nThere will be a tremendous shortage of natural gas for the coming winter heating season, which will either keep current domestic and global prices for natural gas elevated at current levels or cause further rises. \u00a0 \u00a0We can\u2019t say for sure, but the demand will be there for sure. And China is ready to pounce on Taiwan with little consequence from the West.<\/p>\n

4. \u00a0A strange\u00a0fraud may be emerging in Social Media<\/strong>\u00a0regarding how Advertisers have been billed for advertising products or services to phony bot accounts. \u00a0 It is very likely that advertisers will be scrutinizing their previous payments and future payments for advertising threatening the business models of social media companies. \u00a0If so, and I strongly suspect it to be so, the projections for revenue and profit growth for social media companies will be remodeled, contributing to a decline in actual value, not just perceived value. \u00a0 It could be the current valuations for social media companies are still over valued and sharp declines for their stock prices are \u201cin the cards\u201d for the next several quarters.<\/p>\n

There are more risks such as destructive tax policies, domestic civil unrest, clash of domestic ideologies, assault on the US Judiciary and continued gross voting fraud, as well as , public health policy built on false assumptions simply for imposition of infringement of liberties.<\/p>\n

I cant\u2019 think of a period in my life (born 1952) more dangerous than now. \u00a0Even the Cuban Missile crisis did not have as many different threats from as many different sources. \u00a0It was a perceived existential threat from nuclear power, Russia, to set up a nuclear threat right near our boundary. \u00a0Looks familiar to me today with NATO setting up aggressive forces at Russia\u2019s border and promoting the idea since 2020 of admitting Ukraine to NATO.<\/p>\n

The only stock risk I can understand to be useful now is to own the production of domestic of US Domestic natural gas, whether it is for domestic consumption, or export for consumption in Europe, etc., as Liquified Natural Gas. \u00a0That would be the base upon which to discover opportunities of sensible risk for investment growth to me. \u00a0 Somewhat similarly useful are producers of copper, nickel, steel, iron ore, platinum group metals, gold (of course), silver and phosphate fertilizer to alleviate the coming food shortages. \u00a0If it comes out of the ground, it worth examination.<\/p>\n

Stock markets have experienced optional or voluntary liquidation so far. \u00a0 Just wait until the bear market gets into its stages preceding to and into the Involuntary liquidation, or \u201cforced selling.\u201d \u00a0 This is when financial leverage destroys its own wealth. \u00a0Today we still hear irrational platitudes of encouragement to remain invested. \u00a0 These platitudes have no fundamental justification by allure naive to hope for positive returns being just \u201caround the corner.\u201d<\/p>\n

In 2008, many households were afraid to open their period statements from their 401K plans, or their investment manger statements. \u00a0Today, households are still accessing their accounts online with hope for improvement.<\/p>\n

The 1970\u2019s TV show, The A TEAM, featured Mr T\u2019s forceful emphatic toned voice expressions, such as \u201cThere will be Pain\u201d or \u201cI pity the fool\u2026\u201d have now become relevant again today for those who are willing to be intelligent and use their aptitude for self preservation.<\/p>\n

The post Economic Blowback from Russian Sanctions<\/a> appeared first on The Gateway Pundit<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"

Warren Strauss is a dear friend and a wise man in the world of finance and investment. 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