The Great Currency Crisis Of Our Lifetimes Is Starting Now

The single most important asset in the world is the USD.

The USD is the reserve currency of the world. It is involved in ~95% of all currency transactions globally.

Moreover, it is used in 85% of all global trade. As the New York Fed notes, the USD is used in HALF of all cross-border loans/ international debt securities. It also comprises 60% of global foreign exchange reserves.

Put simply, MOST of the debt in the world is denominated in U.S. dollars.

When you borrow in U.S. dollars, you are effectively shorting the USD This is especially true if your domestic currency is NOT the USD. Imagine the impact of paying back $100 million in debt if your currency is DOWN 30% against the USD.

As a result of this, the world is on the verge of a major currency crisis. The USD continues to roar higher…

…which is resulting in MAJOR currencies trading like microcap stocks.

The British Pound is imploding, dropping to a 30-year low. The below chart is that of the currency of the FIFTH largest economy in the world… not some tech startup!

The same is happening for Japan… the 3rd largest economy in the world.

This is going to trigger a major currency crisis soon.

I’m talking about a crisis to which 2008 was just the warm up… the crisis in which ENTIRE countries go bust.


More By This Author:

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The Fed’s Worst Nightmare Has Officially Arrived

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Reid Holloway 1 month ago Contributor's comment

short, sweet, to the point.  i interpret debt as equivalent to shorting as something that lays the groundwork for a sharp spike followed by a bust.  over what time frame?  who knows.  but this would parallel u.s. debt and equity markets which are also dollars.