Bond Markets Finally Beginning To Comprehend That ESG Mandates Equate Higher Interest Rates For Longer: Canada Could Be Headed For Some Serious Economic Hardships – October 5, 2023
Personally, I’ve been calling most Bond traders “BEAN COUNTERS” for quite some time now, as I find people in the bond market ignore the DOMESTIC economy and instead focus their attention on Wall Street.
Personally, my habit is to watch PRICE CONTROLS because price controls are often an indicator of consumer price inflation because the entire scam that is fiat money is denying economic DEFLATION.
If we were on a gold standard for example, wage-price controls, it would destroy the economy almost immediately. People forget that wages are indeed PRICES, and if the GOVERNMENT sets an arbitrary wage based on what Left-wingers call a “livable wage,” well, then the entire market has to adjust to these FAKE wages, which under a gold standard would equate to collapse because you can’t get the government to make a number to define the price of gold.
If it’s more expensive to mine for gold thereby expanding the operational costs, well then the entire economy, including the PRICE OF government, has to adjust, and market participants in any economy HATE paying higher prices for things, especially if their incomes are not keeping pace with inflation, so what you get are fewer PURCHASES, which equates to fewer JOBS, because if my business is affected by what consumers no longer need, then I go out of business.
So you start to see why PRICE CONTROLS end up causing economic deflation. Now, the concept behind fiat money and central banks is that when the democratic process doesn’t work(meaning voters vote for an idiot politician promising them free stuff in exchange for their vote), then the Government has the ability to reward itself with free money from its CENTRAL BANK.
Ofcourse, this is all bullshit. The government and the central bank can’t stimulate job growth; what they can do is go into debt and drag their citizens into debt with them. So you’ll often see governments CREATE jobs out of thin air, which stimulates job growth with FAKE MONEY.
Under the gold standard when FDR tried to stimulate job growth with GOVERNMENT jobs, it led to a great depression, now, what people tend to forget during the great depression is that Americans were doing a lot of SAVING, they were doing this because their government was INCOMPETENT in practice, but FDR’s idea’s sounded brilliant in theory.
Again that’s DEMOCRACY in action, this again is why I argue that there was a DEMAND even back then for a fiat monetary system, this is why when Richard Nixon took America off the Gold Standard, a lot of Americans thought it was a great idea.
What most people tend to forget, however is that Richard Nixon also implemented PRICE CONTROLS, and this is part of the Nixon Shock that most Republicans and Democrats like to ignore. One of the reasons Jimmy Carter was such a bad president was that he failed to comprehend that Nixon’s Price controls were the root cause of his horrible economy.
But the more savvy figured out that the world was addicted to U.S. dollars, which is why I personally like to talk about the DOMESTIC U.S. and the Eurodollar as two different things. In actuality, I don’t even like using the term Eurodollar, because the truth we’re talking about U.S. dollars being used outside of the United States, which basically equates to the U.S. dollar being a ledger currency that is in many ways more powerful than the IMF.
The free market, for whatever reason, likes U.S. dollars, and separating the domestic U.S. dollars from the Eurodollar is rather difficult for most people to do, as they’d like to imagine that global conditions should dictate U.S. central bank policy. But the U.S. central bank revolves around U.S. fiscal policy, and if the deficit is growing and REVENUE to the government is not, it’s an indication that fiscal policies are out of whack.
Since Joe Biden became President, he declared war on fossil fuels, which caused consumer price inflation, and the worst part of consumer price inflation is the believers in PRICE CONTROLS. Because if inflation goes up and I want to LOCK IN my new higher wage, I’ve just created a new FLOOR for the DOMESTIC U.S. dollar.
ESG is very similar to Marxism in that it seeks to add layers to the bureaucratic process, and it’s similar to fascism in that it seeks every country to yield to its dominance. So, as was the case with FDR when he led Americans into war, so appears to be the case with Joe Biden, as you’re noticing a lot of third world nations are complaining about the U.S. dollar ECONOMY destroying their economy.
Now, the U.S. dollar gets the blame, but it’s getting the blame because prior to Joe Biden if a country did trade with the U.S. in U.S. dollars, there was a profit EXPECTATION attached, well, with this war on fossil fuels, profit margins in the U.S. dollar and the U.S economy are drying up, what this equates to is that the Federal Reserve should continue to raise interest rates.
So if ESG becomes the norm in all Western countries, I personally think ti will take some time before interest rate EXPECTATIONS reverse because what will have to happen to lower interest rates can’t happen under these ESG regulations; ESG is even anti-technology; a lot of fossil fuels go into manufacturing machines, and ESG is making sure that the automation process is more expensive. How nobody can’t see this is beyond my comprehension, it should be obvious.
Based on my observations, I have yet to see anyone champion Austerity measures, Late Stage Socialism is what I view as Austerity or continued consumer inflation, which could lead hyperinflation. Until fiscal policies change, expect the interest rates to rise and if rates come down, expect consumer prices to rise more aggressively if fiscal policies are not made to cut government regulation’s, namely ESG regulations.
Interesting times ahead!