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January 2023

The US dollar’s bull market appears to have come to a climactic end late in Q3 22 and early Q4. In the last three months of 2022, the G10 currencies, except…



The US dollar's bull market appears to have come to a climactic end late in Q3 22 and early Q4. In the last three months of 2022, the G10 currencies, except the Canadian dollar, rose by more than 5% against the greenback. In addition, six of the G10 currencies appreciated more than 7.5%. Such significant moves are often followed by consolidation and corrections. These countertrend moves can offer new opportunities to adjust currency exposures.

Three main considerations mark the turn of the dollar from valuation levels that were stretched to historic proportions according to the OECD's measure of purchasing power parity. Without getting too granular, the basic premise is that a basket of internationally traded goods should sell for the same price when the currency adjustment is made. To the extent that they do not, it reflects a currency misalignment. Typically, OECD currencies do not deviate much more than 20% plus/minus fair value. However, in Q3 22, the euro and yen were more than 45% undervalued, and sterling was more than 25% below fair value.

First, sterling's snapback was the most dramatic. The return of fiscal orthodoxy was marked by the resignation of UK Prime Minister Truss. As a result, the capital strike against Truss's unfunded fiscal stimulus was called off. Instead, it spurred a dramatic short-covering rally that lifted sterling by more than 10% in less than two weeks following her resignation.

Second, the market's confidence grew that the peak in US inflation was behind it and that the terminal rate of Fed funds would be around 5%. The Federal Reserve's Summary of Economic Projections issued in mid-December confirmed these expectations, with a median estimate of 5.1%. The dollar's rally in 2022 seemed disproportionately fueled by the adjustment to an increasingly higher terminal rate. Moreover, despite pushback from several Federal Reserve officials, the pricing in the derivatives market showed an unambiguous expectation for the first rate cut to be delivered in Q4 23.

Third, the European Central Bank turned increasingly hawkish after a delayed start. Its tightening cycle is expected to extend beyond the Federal Reserve's and into the middle of 2023. This is partly reflected in the US-German two-year rate differential. We anticipated that the US two-year premium would peak before the dollar. The US premium peaked in early August at around 277 bp, a three-year high. It trended low and fell below 175 bp in mid-December. The exchange rate often seems more sensitive to the direction and change than the absolute level.

In our work, we do not find it coincidental that the US 10-year Treasury peaked (~4.33%) on the same day as the dollar peaked against the yen (JPY151.95) on October 21. By the time the BOJ met late last month, the 10-year yield was consolidating after falling to around 3.40%, and the dollar was in a couple-week range between around JPY134-JPY138. Then, unexpectedly on December 20, the BOJ announced it was widening the range of the 10-year yield under yield-curve-control to +/- 50 bp of zero. The yield quickly jumped and approached the new cap. Market participants and the media tended to put more emphasis on the increased cap than the boost in government bond purchases announced at the same time. 

The yen soared by more than 4% on the day of the announcement. Not only was nearly everyone caught wrong-footed, but it immediately was seen as raising the odds of more adjustments next year when the BOJ will have new leadership. Several possible adjustments next year include lifting the target rate to zero from -0.10% and/or raising the midpoint of the 10-year bond range to 0.25% from zero. 

Bank of Japan Governor Kuroda's term end in April, and the two deputy governors' terms end in March. New appointments are typically announced in February. The most likely candidate to replace Kuroda is one of his proteges. Current deputy governor Masayoshi Amamiya has a slight advantage over former deputy governor Nakaso Hiroshi. The BOJ's current charge is to achieve the 2% inflation target at the "earliest date possible," which could be modified to clarify that it is a medium-to-long-term goal.

Looking into 2023, most of the G10 central banks may complete their rate hike cycles around the middle of the year. The unwinding of central bank balance sheets may continue longer, but the amount of reserves that the banking systems need is not immediately apparent. We suspect the floor will only be found when stresses become evident. 

China made a dramatic pivot from the zero-Covid policy, and the surging infection and fatalities risk disruptions to growth and, potentially, supply chains. The government is expected to pursue more pro-growth policies after 2022, which ended on a particularly weak note. Tensions with the US may flair up if the new leadership of the US House of Representatives insists on visiting Taiwan. We are somewhat skeptical of the ability to deny China semiconductor technology, even with Japan and the Netherlands joining. For example, the ability to restrict nuclear technology proved limited, as North Korea and Iran demonstrate.  

China will likely be able to develop seven-nanometer chips from 14-nanometer technology, and Beijing will boost aid to the sector. Consider that the US CHIPS legislation included $1.8 bln to help support the semiconductor industry, while reports suggest Beijing is preparing a CNY1 trillion (~$144 bln) package for its domestic chip industry. Moreover, China's advances in artificial intelligence rest on its accumulation of data, and it continues to show leadership in that space. 

Russia's invasion of Ukraine has impacted geopolitics and economies in ways that were arguably unimaginable to Moscow, Washington, Brussels, Beijing, or Tokyo. Russia's ability to project its military power has been compromised. Ukraine's ability to strike inside Russia appears likely to continue even as it bears a high human cost. Ironically, it is part of the Republican leadership in the US that is questioning the unending support for Kyiv. NATO is larger and will have a greater presence in Europe. As European countries, especially Germany, boost defense spending, they will turn to the US. The US will also replace some of the gas Europe previously got from Russia. 

Moscow's invasion of Ukraine will strengthen forces in Europe that did not or no longer believe that trade foments liberalization in totalitarian regimes, including China. Moreover, the war in Ukraine and China's wolf diplomacy in the Asia Pacific area gave fresh impetus to increased military spending by Tokyo, which has been a longstanding objective of LDP prime ministers for nearly a generation. Japan now aims to double its military spending (to 2% of GDP) and acquire counter-strike capabilities.

Many see stagflation as the most likely scenario amid elevated price pressures and weak growth impulses. However, we wonder if this is not like confusing a snapshot with a video. Although it may not be popular to say, the more likely medium-term outlook is a return to the Great Moderation of slow growth and low-price pressures that characterized the G10 economies before the various systemic shocks. As is often the case, the media and investors elevate cyclical events to structural status, which itself is part of the cyclical phenomenon. If we are right, inflation will trend lower in the coming quarters, barring a new shock. The pace may even accelerate from the middle of the year.  

The flatter and longer business cycles associated with the Great Moderation were overdetermined in the sense that they had many causes. The increased importance of the less cyclical service sector, the less labor coverage of contractual cost-of-living adjustments, better management of inventories, and globalization, among other factors, help explain the Great Moderation. The popular press makes it appear that globalization is the weak link, but since at least the aftermath of 9/11, we have been told globalization was ending. It hasn't. Near-shoring and friend-shoring may shift some supply chains, and protectionism may encourage foreign direct investment instead of exports. Yet, because of automation and other technological advances, production and price efficiencies may still improve. 

One of the implications is that today's labor market tightness in the G10 countries may prove a distraction from what could prove to be a dearth of jobs in the future. This is not about automation replacing a repetitive task in the factory. On the contrary, technological advances are impacting agriculture, the office, and core service jobs. More immediately, the focus on the tightness distracts in another sense. The fact that wages are not keeping pace with inflation means the return to labor is falling in real terms. The resulting cost-of-living squeeze underscores the risk of synchronized economic weakness in North America and Europe. 

Bannockburn's World Currency Index, a GDP-weighted basket of the currencies from the top 12 economies, edged higher in December (~0.8%). It was the first back-to-back monthly gain since the end of 2020. The BWCI recorded its low in early November, marginally slipping through the low recorded in late September. The December gain reflected the appreciation of the yuan (~1.6%), euro (~2.0%), and yen (~2.7%). The Russian rouble was the worst performer in the index, losing almost 16%. The Korean won was the best-performing emerging market currency in the BWCI. It rose by 4%. The Canadian dollar was the weakest of the G10 currencies, depreciating by about 1.4%.  

From its lows, the Bannockburn World Currency Index appreciated by 3.70%. It is the biggest advance since the peak in June 2021. BWCI seems to confirm our sense that a significant extreme in exchange rates is behind us. In line with our expectations for the US dollar to unwind more of its post-Covid gains, we look for the index to advance around 5% in 2023, which would be its best year since 2017.   

Dollar:  If there is a consensus about the US outlook, it is the opposite of 2022, when the economy contracted in H1 and expanded in H2. The resilience of the labor market and the American consumer are expected to carry into the first part of 2023, with the risks of recession increasing later in the year. In the four FOMC meetings in H1 23, the market looks for two quarter-point hikes, with the Fed funds target reaching a terminal rate of 5.0%. If there is a risk, it is that the terminal rate is 5.25% rather than 4.75%. The media and some pundits may have made too much of the divergence of opinion at the FOMC. In the rotation of votes, two hawks (Bullard and George) are replaced with one hawk (Kashkari) and more centrists. Yet Chair Powell has managed the process up until now with few dissents. The more critical tension is between the Fed and the markets. Despite the pushback from officials, the market continues to price in a quarter-point cut toward the end of 2023. In January, we anticipate weak private sector job growth in December (January 6) and soft CPI (January 12), with the headline rate falling below 7% for the first time since November 2021. The core rate may slip below 5.9%, the 2022 low through November. Broadly speaking, we think the dollar's cyclical rally has ended and that it will weaken over the course of 2023.   



Euro:  The prospect of a more aggressive European Central Bank helped lift the euro to new six-month highs near $1.0750 in mid-December before a consolidative phase emerged. A break of the $1.0550 area would signal a deeper correction that could see $1.02. That said, as the divergence of monetary policy begins working in Europe's favor, we anticipate the euro to rise to $1.10-$1.13 in 2023. ECB President Lagarde clearly signaled a pre-commitment to lift key rates another 50 bp at the next meeting (February 2), and the hawkish rhetoric has encouraged the market to price in another half-point move at the mid-March meeting as well. The deposit rate stands at 2.0%, and the terminal rate is seen at 3.50%-3.75%. The maturing long-term loans the ECB granted and the early pre-payment have reduced the central bank's balance sheet by nearly 800 bln euros in November-December. Starting in March, it will not fully re-invest the maturing bonds in its portfolio, initiating a formal quantitative tightening process. Inflation appears to have peaked at 10.7% in October, and the ECB's staff projects it to fall to 6.3% by the end of 2023. Subsidies that are dampening inflation now expire and could see price pressures rise again in the spring. An economic contraction may have already begun, but the ECB's forecasts suggest it may still be short and shallow. 

(December 28 indicative closing prices, previous in parentheses)
Spot: $1.0610 ($1.0405)
Median Bloomberg One-month Forecast $1.0590 ($1.0320)
One-month forward $1.0620 ($1.0445)   One-month implied vol 8.7% (12.3%)    

Japanese Yen: The Bank of Japan caught investors and businesses off-guard last month by doubling the band for the 10-year yield to +/- 0.50%. The yield almost immediately rose to its new cap, and the yen strengthened sharply. Most observers seemed to see the move as a step toward exiting, and the swaps market is pricing in a positive overnight rate (from the current -0.10%) by the end of Q1 23. We are less sanguine. Alongside the 10-year yield cap adjustment, the central bank also announced it would increase its bond purchases (QE) to JPY9 trillion (~$68 bln) a month from JPY7.3 trillion. In addition, the government supplemental budget includes subsidies and other measures that will dampen price pressures. The yen has appreciated 10-11% on a trade-weighted basis, which will also help curb imported inflation. The spring wage round is important, but if the Bank of Japan's 0.2% staff pay increase is anything to go on, wage pressure will remain modest. The BOJ forecasts core CPI, which stood at 3.7% in November, to fall to 1.6% by the end of 2023. Last month, we warned that a break of JPY137.25 could spur a drop to JPY130-JPY133. The greenback tested the lower end of the range with the BOJ's surprise. We now see it has potential to recover back into the JPY136-JPY138 area.  

Spot: JPY134.45 (JPY138.05)    
Median Bloomberg One-month Forecast JPY134.70 
One-month forward JPY134.30 
(JPY137.25) One-month implied vol 12.5% (13.7%)

British Pound: Sterling stopped shy of our $1.25 objective, peaking near $1.2450 in mid-December. A break of the $1.1950 area could signal another cent or so decline, but we see this as corrective in nature and not the end of sterling's recovery. To be sure, the further recovery of sterling we envision, which we project can rise toward $1.28-$1.30 in H1 23, is more about a broadly weaker dollar than positive developments in the UK. With the 0.3% contraction in Q3, the UK's recession, which may last into 2024, has begun. Still, with inflation above 10% (November), the Bank of England's tightening is not over. There probably is scope for another 50 bp hike at the next meeting on February 2 (that would lift the base rate to 4.0%) and after at least a couple of quarter-point hikes for a terminal rate of 4.50% and possibly 4.75%. Given the historic cost-of-living squeeze in the UK, it is difficult to envision the fortunes of the Tory Party improving much in the near-to-medium term.  

Spot: $1.2015 ($1.2060)   
Median Bloomberg One-month Forecast $1.1990 
One-month forward $1.2020 
($1.2085) One-month implied vol 10.6% (12.6%)

Canadian Dollar: Bolstered by a robust economy and an aggressive central bank, the Canadian dollar was the top G10 performer, slipping 1.8% against the strong US in H1 22. However, the process went into reverse in the second half, and the Canadian dollar was the weakest of the major currencies, falling about 5.3% against the dollar. A strong labor market and sticky core inflation measure suggest the Bank of Canada is not quite done with tightening monetary policy. Another quarter-point hike is likely when it meets on January 25, which would take the target rate to 4.50%. Although a pause in March is possible, we suspect another 25 bp hike in Q2 23 will conclude the tightening cycle. This is somewhat more aggressive than the swaps market implies. The US dollar's recovery from the CAD1.3225 low in mid-November was slightly stronger than we expected, probing the CAD1.3700 area. Still, barring a new shock, the mid-October high of almost CAD1.3980 still appears to be the peak. A break now of CAD1.35 would strengthen our conviction. 

Spot: CAD1.3610 (CAD 1.3410) 
Median Bloomberg One-month Forecast CAD1.3610 (CAD1.3425)
One-month forward CAD1.3615 (CAD1.3415)   One-month implied vol 7.7% (9.3%) 

Australian Dollar:   The Australian dollar's rally from a 20-month low in mid-October near $0.6170 peaked in mid-December a little shy of $0.6900 and the 200-day moving average, which has largely capped corrections since May. We suspect a correction has begun that may push the Australian dollar toward $0.6550-$0.6600 in the coming weeks. Official comments, signs of economic softness, and a decline in consumer inflation expectations are encouraging the market to lean toward the expecting the central bank to pause when it meets next on February 7. To be sure, the derivatives market does not expect it to be finished, but after hiking the cash target rate from 0.10% as recently as April to 3.10% in December and slowing to 25 bp increments in the last three moves, a pause may be in order. The policy rate is seen to be at least 60-75 higher by the end of 2023. Softer commodity prices may be offset as the year progresses by China's recovery and at least marginally better (trade) relations.  

Spot: $0.6735 ($0.6790)     
Median Bloomberg One-month Forecast $0.6720 
One-month forward $0.6740 ($0.6805)    One-month implied vol 12.5% (14.3%)


Mexican Peso:  The dollar's sell-off in late November to about MXN19.04, its lowest level since March 2020, seemed to exhaust the bears. It spent December mostly in the MXN19.50-MXN19.80 range. The central bank of Mexico, which some feared would turn dovish with AMLO appointments, has earned the market's respect. It will likely continue to match the Fed's moving in the coming months, suggesting a terminal rate of around 11.0%, even as inflation eases. Following December's correction and consolidation, we suspect the US dollar can retest the Q4 22 lows in Q1 23. The absence of significant fiscal stimulus during the pandemic will help Mexico avoid some funding challenges of other emerging markets. Moreover, the proximity to the US and the USMCA means it is uniquely positioned to benefit from the near-shoring and friend-shoring developments, with knock-on positive implications for its trade balance.    

Spot: MXN19.4375 (MXN19.27)  

Median Bloomberg One-Month Forecast MXN19.48 (MXN18.47)  
One-month forward MXN19.4580 (MXN19.3750) One-month implied vol 11.0% (11.2%)

Chinese Yuan: Last month, we anticipated the dollar would fall below CNY7.0, but the driver took us by surprise. After some stutter steps, China backed away from its zero-Covid policy, which spurred a 20% rally in mainland shares that trade in Hong Kong. The dollar also fell against the euro and yen, which, in recent weeks, has been strongly correlated to its performance against the yuan. The greenback spent most of December trading in a narrow range of roughly CNY6.9370-CNY7.000. It is difficult to decipher the intention of the PBOC, but we suspect that the price action in December formed a base from which the dollar can move higher in the coming weeks. We suggest a CNY7.05-CNY7.09 target range. Although the disruption spurred by the surge in Covid cases, leaving aside the human toll, may hobble the economy (with risks to supply chains) in the first part of the new year, we anticipate monetary and fiscal support to help lift the economy.  

Spot: CNY6.9820 (CNY7.0925)
Median Bloomberg One-month Forecast CNY6.99 (CNY7.1210) 
One-month forward CNY7.0150 (CNY7.0150) One-month implied vol 8.9% (8.9%)  




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Economic Death Spiral

Economic Death Spiral

Authored by Robert Stark via Substack,

Fed Trap: Financial Collapse or Hyper Inflation?

With this banking crisis,…



Economic Death Spiral

Authored by Robert Stark via Substack,

Fed Trap: Financial Collapse or Hyper Inflation?

With this banking crisis, which has serious Lehman vibes, it is a good time to revisit my article, Is This The End of The End of History, from March of last year. The article dealt with the theme of collapse vs stagnation, and historical cycles, in light of the Ukraine war, the post-pandemic climate, the onset of inflation, and speculation about economic collapse. A point of mine, that has especially been vindicated, is that “a delay in the Fed raising interest rates, could cause a short term rally in stocks, further expanding the bubble. The bigger the bubble, the worse inflation gets, and the longer the Fed keeps delaying raising rates, the worse the crash will be down the road.” For the most part, most of my geopolitical and economic forecasts have come true, though I actually predicted an economic collapse to occur sooner, which actually vindicates that point, that kicking the can down the road will just create a much worse crisis.

Despite countless signs of economic volatility, the recent bank failures, with shockwaves to the entire financial system, are a turning point, where it is clear that there is going to be a severe economic downturn. For instance, Elon Musk recently said, lot of current year similarities to 1929, and Moody’s cut the outlook on the entire U.S. banking system to negative from stable, citing a "rapidly deteriorating operating environment." Even the perma bulls, mainstream media, and financial “experts,” can no longer deny the obvious signs of economic peril. However, the bullish propaganda was still strong as recently as January, which was really the bulls’ last gasp, with the monkey rally, in response to the Fed only raising interest rates by .25 points, plus economic data showing record low unemployment plus a dip in inflation.

It is important to emphasize that the same figures in media, banking, and government, who were recently shilling a soft landing or mild recession, were previously saying that inflation is transitory. It is especially laughable to think that there are people who take someone like CNBC’s, Jim Cramer, seriously, who in 2008 told his audience don’t be silly on Bear Stearns, right before it crashed, and more recently shilled for Silicon Valley Bank, and is still predicting a soft landing. A lot of the recent propaganda is practically identical to right before the 08 crash, as well as during stagflation in the 70s, and even before the Great Depression, as the media has vested economic and political interests in propping up the markets. The financial YouTuber, Maverick of Wall Street, brilliantly uses this “self-love” gif of  Jack Nicholson, from the film, One Flew Over the Cuckoo’s Nest, as a metaphor for whenever perma-bulls see any data that may signify a Fed pivot, causing stocks to rally. As the desperation really kicks in, expect further talk of a soft landing, as well as more rallies in stocks, as we saw in response to the bailouts, as well as desperate investors switching back and forth between the NASDAQ and S&P500, which happened in 08. So any return to bullish sentiment is actually a sign of greater economic catastrophe. The stock market rallying over bad economy news, as a sign of a potential pivot, just further shows that the markets are not a good metric for the health of the economy. Not to mention that the top 1% own over half of all stocks.

It has always been the case with bubbles, that the greater the size of the bubble, the more copes to deny reality, and the more vested interests there are in preventing the inevitable crash. Certainly many corporations and banks have made economic decisions based upon an assumption of a soft landing or Fed pivot. This also explains the gaslighting to justify that the 2010s economic boom, especially in tech, was based upon productivity and innovation, when it was primary due to Fed monetary policy, plus data mining in the case of Big Tech. While it is silly for conservatives to blame wokeness as the primary culprit of bank failures, wokeness and bullshit DEI jobs, are a symptom of the corruption that Fed policy enabled. 

Fed Balance Sheet: Return to QE


The current banking crisis is triggering more stock buybacks, and a return to Quantitative Easing with the bank bailouts, including plans to inject another $2 Trillion into the banking system, on top of the $300 billion increase in the Fed’s Balance Sheet, in just the last week. This seems counter intuitive, as QE caused inflation, but the economy is so addicted to the “Cocaine,” that is  cheap money. So basically quantitative tightening is being implemented and interest rates raised  to stop inflation, but as soon as the first major economic disruption of raising rates is felt, then a return to financial policies to further prop up the bubble, causing more inflation. Now the Fed is trapped with two bad options, raise rates or pivot, both of which will lead to inevitable economic doom.

Populists can talk about nationalizing the banks into public debt free banking, and Austrian School libertarians can call for ending the Fed, and returning to a gold standard. While it is true that the Federal Reserve is a corrupt system, that is quasi private in how private banks own shares, the reality is that we are stuck with this system of relying upon the Fed’s interest rates, for the incoming economic crisis. If the Fed continues raising rates, there will be a liquidity crisis, with more bank failures. While interest rates were close to zero, banks used uninsured deposits to both invest in securities and purchase bonds, and thanks to fractional reserve banking, banks are only required to hold a fraction of deposits. So when rates rose, bonds fell in value and unrealized losses surged, so the banks were not able to pay off their depositors.


Regional banks make up about half of all US banking, so any contagion in the banking system, as people and businesses move their deposits to mega banks, deemed “too big to fail,” could trigger a Depression. One of the main reasons that the economy has not crashed sooner is because more people have been tapping into their savings and maxing out their credit cards. However, high interest rates will cause many people to default on their credit card debt, which will exacerbate the banking crisis. Not to mention Auto loans defaults wiping out credit unions, and the potential for another mortgage crisis, due to rising mortgage rates. There is a ripple effect, as far as rising interest rates being felt by debt holders, and now is just the tip of the iceberg. This could end up being a multifaceted debt crisis, in banking, corporate debt, personal debt, and government debt.

Besides the Fed likely pivoting soon due to the banking crisis, higher rates will make interest payments on the National Debt too expensive to pay off, risking a default on government debt. Overall levels of debt, both public and private, are much worse than when Fed Chair, Volcker, raised rates very high to successfully quell inflation. Any freeze in Federal spending or a default on the national debt, in response to the debt ceiling, will crash the economy, and any major extension in the debt ceiling will accelerate inflation. There is a good chance that inflation will be tolerated, with the dollar greatly devalued, to make government debt cheaper so that creditors eat the costs.

Source: Peter G. Peterson Foundation

A tight labor market is the main case that the bulls make to prove a strong economy. However, the official BLS jobs numbers are “baked” to exclude those who have given up on seeking employment, as well as counting 2nd or 3rd jobs. Not to mention that the BLS numbers were exposed by the Fed as overstating 1 million jobs during 2022. Even if one accepts the “baked” numbers, layoffs have a lagging effect on unemployment, including by industry (eg. tech layoffs before service sector). Now new jobless claims have grown at the fastest pace since Lehman'. It is also noteworthy that just about every recession has been preceded by low unemployment numbers. The increase in layoffs will put further pressure on the Fed to pivot, which on top of increased unemployment benefits, will cause inflation to surge again. This creates another doom loop, as inflation leads to more unemployment, as consumers are forced to cut back on spending.

Source: ZeroHedge

While bulls can say that this time is different from past crashes, all of the signs are pointing to this crisis being much worse than previous crashes. For instance, the economic recovery, after Volcker was done raising rates to fight inflation, was possible because of lower levels of debt, but the US has never entered a recession with debt/GDP at 125% and deficit/GDP at 7% in at least 85 years. Also the fallout of the 2008 crash was mitigated by a strong dollar, which also minimized the effects of inflation last year, but inflation will surge if the dollar is weakened. Despite signs of a pivot, the Fed has been moving much faster to fight inflation, then in the past, even with Volker. This crisis is also unique in that rates are being raised while entering a severe recession, and inflation could coincide mass layoffs. While the general assumption is that severe economic downturns are deflationary, financial commentator, Peter Schiff, makes a compelling case as for why an Inflationary Depression is a likelihood. Under this nightmare scenario, which would be much worse than even the Great Depression, inflation will negate any of the remedies that ended past crises, such as the New Deal, quantitative easing in 08, and the covid stimulus. Other signs of economic peril include, the steepest yield curve inversion since the early 80s recession, which is a barometer that has predicted just about every single recession, a major decline in ISM manufacturing sales, a big decline in savings rates, and Americans’ credit card debt approaching a record $1 Trillion.


This is the perfect storm with inflation, stagflation, recession, a potential debt crisis, as well as energy and supply chain issues. With this bubble to end all bubbles or too big to fail on steroids, the Fed has two choices, cause a liquidity crisis by shrinking the money supply, or letting inflation rip. While raising rates appears to be the least bad of these two options, further rate hikes are futile with the return of QE. A combo of QE plus interest rates having to remain high, is what could lead to that scenario of inflationary financial collapse, that Peter Schiff warned about. Though most likely it will either be long term stagflation or a deflationary Depression. This is not a hyperbole, nor clickbait, but a Depression is a very real possibility, especially if policy makers continue to kick the can down the road, to prop up the bubble.

*  *  *

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Tyler Durden Tue, 03/21/2023 - 17:25

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Three Years To Slow The Spread: COVID Hysteria & The Creation Of A Never-Ending Crisis

Three Years To Slow The Spread: COVID Hysteria & The Creation Of A Never-Ending Crisis

Authored by Jordan Schachtel via ‘The Dossier’…



Three Years To Slow The Spread: COVID Hysteria & The Creation Of A Never-Ending Crisis

Authored by Jordan Schachtel via 'The Dossier' Substack,

Last Thursday marked the three year anniversary of the infamous “15 Days To Slow The Spread” campaign.

By March 16, yours truly was already pretty fed up with both the governmental and societal “response” to what was being baselessly categorized as the worst pandemic in 100 years, despite zero statistical data supporting such a serious claim.

I was living in the Washington, D.C. Beltway at the time, and it was pretty much impossible to find a like-minded person within 50 miles who also wasn’t taking the bait. After I read about the news coming out of Wuhan in January, I spent much of the next couple weeks catching up to speed and reading about what a modern pandemic response was supposed to look like.

What surprised me most was that none of “the measures” were mentioned, and that these designated “experts” were nothing more than failed mathematicians, government doctors, and college professors who were more interested in policy via shoddy academic forecasting than observing reality.

Within days of continually hearing their yapping at White House pressers, It quickly became clear that the Deborah Birx’s and Anthony Fauci’s of the world were engaging in nothing more than a giant experiment. There was no an evidence-based approach to managing Covid whatsoever. These figures were leaning into the collective hysteria, and brandishing their credentials as Public Health Experts to demand top-down approaches to stamping out the WuFlu.

To put it bluntly, these longtime government bureaucrats had no idea what the f—k they were doing. Fauci and his cohorts were not established or reputable scientists, but authoritarians, charlatans, who had a decades-long track record of hackery and corruption. This Coronavirus Task Force did not have the collective intellect nor the wisdom to be making these broad brush decisions.

Back then, there were only literally a handful of people who attempted to raise awareness about the wave of tyranny, hysteria, and anti-science policies that were coming our way. There were so few of us back in March in 2020 that it was impossible to form any kind of significant structured resistance to the madness that was unfolding before us. These structures would later form, but not until the infrastructure for the highway to Covid hysteria hell had already been cemented.

Making matters worse was the reality that the vast majority of the population — friends, colleagues, peers and family included — agreed that dissenters were nothing more than reckless extremists, bioterrorists, Covid deniers, anti-science rabble rousers, and the like.

Yet we were right, and we had the evidence and data to prove it. There was no evidence to ever support such a heavy-handed series of government initiatives to “slow the spread.”

By March 16, 2020, data had already accumulated indicating that this contagion would be no more lethal than an influenza outbreak.

The February, 2020 outbreak on the Diamond Princess cruise ship provided a clear signal that the hysteria models provided by Bill Gates-funded and managed organizations were incredibly off base. Of the 3,711 people aboard the Diamond Princess, about 20% tested positive with Covid. The majority of those who tested positive had zero symptoms. By the time all passengers had disembarked from the vessel, there were 7 reported deaths on the ship, with the average age of this cohort being in the mid 80s, and it wasn’t even clear if these passengers died from or with Covid.

Despite the strange photos and videos coming out of Wuhan, China, there was no objective evidence of a once in a century disease approaching America’s shores, and the Diamond Princess outbreak made that clear.

Of course, it wasn’t the viral contagion that became the problem.

It was the hysteria contagion that brought out the worst qualities of much of the global ruling class, letting world leaders take off their proverbial masks in unison and reveal their true nature as power drunk madmen.

And even the more decent world leaders were swept up in the fear and mayhem, turning over the keys of government control to the supposed all-knowing Public Health Experts.

They quickly shuttered billions of lives and livelihoods, wreaking exponentially more havoc than a novel coronavirus ever could.

In the United States, 15 Days to Slow The Spread quickly became 30 Days To Slow The Spread. Somewhere along the way, the end date for “the measures” was removed from the equation entirely.

3 years later, there still isn’t an end date…

Anthony Fauci appeared on MSNBC Thursday morning and declared that Americans would need annual Covid boosters to compliment their Flu shots.

So much of the Covid hysteria era was driven by pseudoscience and outright nonsense, and yet, very few if any world leaders took it upon themselves to restore sanity in their domains. Now, unsurprisingly, so many elected officials who were complicit in this multi-billion person human tragedy won’t dare to reflect upon it.

In a 1775 letter from John Adams to his wife, Abigail, the American Founding Father wrote:

“Liberty once lost is lost forever. When the People once surrender their share in the Legislature, and their Right of defending the Limitations upon the Government, and of resisting every Encroachment upon them, they can never regain it.”

Covid hysteria and the 3 year anniversary of 15 Days To Slow The Spread serves as the beginning period of a permanent scar resulting from government power grabs and federal overreach.

While life is back to normal in most of the country, the Overton window of acceptable policy has slid even further in the direction of push-button tyranny. Hopefully, much of the world has awakened to the reality that most of the people in charge aren’t actually doing what’s best for their respective populations.

Tyler Durden Tue, 03/21/2023 - 18:05

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From the bed sheets to the TV remote, a microbiologist reveals the shocking truth about dirt and germs in hotel rooms

The filthy secrets of hotel rooms and why you might want to pack disinfectant on your next trip.




Relaxing in filth? Pexels/Cottonbro studio

For most of us, staying in a hotel room is either something of a necessity – think business travel – or something to look forward to as part of a holiday or wider excursion.

But what if I told you there’s a large chance your hotel room, despite how it might appear to the naked eye, isn’t that clean. And even if it’s an expensive room, that doesn’t necessarily mean it’s any less dirty.

Indeed, whoever has stayed in your room prior to you will have deposited bacteria, fungi and viruses all over the furniture, carpets, curtains and surfaces. What remains of these germ deposits depends on how efficiently your room is cleaned by hotel staff. And let’s face it, what is considered clean by a hotel might be different to what you consider clean.

Typically, assessment of hotel room cleanliness is based on sight and smell observations –- not on the invisible microbiology of the space, which is where the infection risks reside. So let’s take a deep dive into the world of germs, bugs and viruses to find out what might be lurking where.

It starts at the lift

Before you even enter your room, think of the hotel lift buttons as germ hotspots. They are being pressed all the time by many different people, which can transfer microorganisms onto the button surface, as well back onto the presser’s fingers.

Communal door handles can be similar in terms of germ presence unless sanitised regularly. Wash your hands or use a hand sanitiser after using a handle before you next touch your face or eat or drink.

The most common infections people pick up from hotel rooms are tummy bugs – diarrhoea and vomiting – along with respiratory viruses, such as colds and pneumonia, as well as COVID-19, of course.

Hotel door opening.
Welcome to germ paradise. Pexels/Pixabay

Toilets and bathrooms tend to be cleaned more thoroughly than the rest of a hotel room and are often the least bacteriologically colonised environments.

Though if the drinking glass in the bathroom is not disposable, wash it before use (body wash or shampoo are effective dishwashers), as you can never be sure if they’ve been cleaned properly. Bathroom door handles may also be colonised by pathogens from unwashed hands or dirty washcloths.

Beware the remote

The bed, sheets and pillows can also be home to some unwanted visitors. A 2020 study found that after a pre-symptomatic COVID-19 patient occupied a hotel room there was significant viral contamination of many surfaces, with levels being particularly high within the sheets, pillow case and quilt cover.

While sheets and pillowcases may be more likely to be changed between occupants, bedspreads may not, meaning these fabrics may become invisible reservoirs for pathogens – as much as a toilet seat. Though in some cases sheets aren’t always changed between guests, so it may be better to just bring your own.

Less thought about is what lives on the hotel room desk, bedside table, telephone, kettle, coffee machine, light switch or TV remote – as these surfaces aren’t always sanitised between occupancies.

TV remote lying on pink bedding.
Handle with care: the TV remote is often one of the dirtiest items in a hotel room. Pexels/Karolina grabowska

Viruses such as the norovirus can live in an infectious form for days on hard surfaces, as can COVID-19 – and the typical time interval between room changeovers is often less than 12 hours.

Soft fabric furnishings such as cushions, chairs, curtains and blinds are also difficult to clean and may not be sanitised other than to remove stains between guests, so washing your hands after touching them might be a good idea.

Uninvited guests

If all those germs and dirty surfaces aren’t enough to contend with, there are also bedbugs to think about. These bloodsucking insects are experts at secreting themselves into narrow, small spaces, remaining dormant without feeding for months.

Small spaces include the cracks and crevices of luggage, mattresses and bedding. Bed bugs are widespread throughout Europe, Africa, the US and Asia – and are often found in hotels. And just because a room looks and smells clean, doesn’t mean there may not be bed bugs lurking.

Woman making bed in hoteroom.
Get those cushions off the bed straightaway. Pexels/Cottonbro studio

Fortunately, bed bug bites are unlikely to give you a transmissible disease, but the bite areas can become inflamed and infected. For the detection of bedbugs, reddish skin bites and blood spots on sheets are signs of an active infestation (use an antiseptic cream on the bites).

Other signs can be found on your mattress, behind the headboard and inside drawers and the wardrobe: brown spots could be remains of faeces, bed bug skins are brownish-silvery looking and live bed bugs are brown coloured and typically one to seven millimetres in length.

Inform the hotel if you think there are bed bugs in your room. And to avoid taking them with you when you checkout, carefully clean your luggage and clothes before opening them at home.

As higher-status hotels tend to have more frequent room usage, a more expensive room at a five-star hotel does not necessarily mean greater cleanliness, as room cleaning costs reduce profit margins. So wherever you’re staying, take with you a pack of antiseptic wipes and use them on the hard surfaces in your hotel room.

Also, wash or sanitise your hands often – especially before you eat or drink anything. And take slippers or thick socks with you so you can avoid walking barefoot on hotel carpets – known to be another dirt hotspot. And after all that, enjoy your stay.

Primrose Freestone does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

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