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China Trade Deficit Equals Treasury Doom

The phrase "cornered rats" comes to mind when contemplating the collection of Fed officials hunkered down in their propaganda bunker. They have used up each and every tool in their monetary toolbox. They have used up every myth to try to make it sound like the U.S. still had a functional market for its sovereign debt.

Now, just as the U.S. municipal bond market teeters on the brink of an horrific collapse, we also have the debt market for the U.S.'s sovereign debt suddenly appearing every bit as fragile (i.e., ready to implode).

The debt schemes that have allowed the U.S. government to avoid assuming any fiscal responsibility for its incompetent management of the economy are about to collapse, and nothing can change that reality.

This makes the warning of "imminent hyperinflation" for the U.S. economy more pertinent than at any time since Shadowstat's John Williams started sounding the alarm nearly a decade ago.

This also means the window of opportunity for U.S. dollar-holders to convert that worthless paper to gold and/or silver on any kind of favorable terms, is about to permanently close. While most, if not all, of this confetti is headed to zero, it is obvious that the greenback will be the first major currency to collapse.

A "trade deficit" for China equals the end of the line for the Federal Reserve's bond Ponzi-scheme.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.
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