In the US, the second largest bankruptcy of the bank in the country's financial past has just occurred (silicon Valley Bank has bankrupted with nearly half of the companies operating in the highly inflated low-cost technology sector), while the increase in the supply of the dollar has been negative for 3 months, simultaneously approaching a 35-year hole.
In another words, a crack in the asset marketplace that has been inflated for 13 years, a cascading bankruptcy among banks that are rapidly losing their value by taxation bonds, a cascading bankruptcy among the zombified companies increasing on a central bank drip, and another wave of inflation – this time extra-money – seem to be behind the threshold. On this occasion, I let myself to callback my applicable entry from 9 months ago (June 20, 2022) concerning the nature of the implosion in question and what I see as the only effective defence against its effects:
The declines in the financial markets over the last six months have been not a specified correction, but an accelerating implosion of the strategy of pure decreed currencies and seemingly permanent, but purely paper-based "materiality effect". It shall consist of at least the following elements:
1. The deferred cumulative effect of the 3 "printed" recessions (2000-2001, 2007-2009, 2020) and of the 3 inflated as a consequence of the asset marketplace bubbles, as well as the final culmination of the "finalisation" of the global economy launched inactive in the 1980s under the baton of "maestro Greenspan", taking on the natural form of global stagflation.
2. Anticipation of the bankruptcy cascade, which is an apparent culmination of the debt effects of dominoes, especially in the banking sector, which is the inevitable destiny of an utmost and unbiased economy under conditions of accelerating inflation, erstwhile the central banks yet refuse to come to sukurs institutions allegedly "too large to fall".
3. A peculiarly unfavorable non-financial environment characterised by bureaucratic and ideologically advanced energy costs, the erosion of the global strategy of specialisation and division of labour created by the hypochondria totalitarianism of the last 2 years and the geopolitical tension of real atomic origin.
To sum up, this is not, euphemically speaking, a macroeconomic or financial “day as all day” or a manifestation of “natural rhythm of history”. Rather, it is an event horizon that guarantees that at the most fundamental level it will no longer be as it was. The only adequate answer to the sacramental in this context is, therefore, the question of "what to invest in?": to strengthen and deepen household ties, neighbouring, friendly, community and spiritual; i.e. to take care of the value of all the assets which, although financially, seem to be the smallest and, in the accounting dimension, the most elusive, are in fact the only real hard and priceless assets.
Jakub Bożydar Wiśniewski
