'It'll wipe out the world' - new crash fears as $80trillion 'goes missing

[evince]

the economy is a huge bubble. you're dumb if you don't get it.

Dear fucking idiot


Your predictions carry no weight


Your track record dwells in the sewer


Fuck you very much

[Nordberg]

They want the benefits of a capitalist society while trying to keep an authoritarian dictatorship



It completely destroys the self regulating benefits of a capitalist society can produce with good regulation and a proper tax structure

We did it without that aim. Capitalism requires close regulation. The wealthy and companies will cheat without guilt. The founders chartered corporations. If they did something against the public good, their charter could be revoked. That was ended. The personhood of corporations was also installed by Supreme Court subterfuge.Companies will naturally go from capitalism. to oligopoly to a monopoly. It is our politicians who have to keep competition working. They failed miserably.

[cancel2 2022]

There is just an incredible amount of ignorance in the OP and in some of the responses. Let me clear things up.

1. There is only about 2 trillion dollars of actual currency in circulation. So if some dollar figure is greater than the amount of currency in circulation, it does NOT mean that it could 'wipe out the dollar'. That's hyperbolic and stupid, and it was NOT what BIS stated. That's bullshit #1.

2. The money is not 'missing'. Obviously, whoever said that is ignorant. It already exists. It simply exists in the form of a currency swap, meaning the holder can exchange the foreign currency for US dollars. Since the dollar is very strong against other currencies, there is a possibility that some of those may be executed, but frankly, it's unlikely. There is a reason it is being held in that manner. But it doesn't really matter. It would not cause a 'crash' because it is not a demand for CURRENCY. It is a demand for dollars. Anyone who thinks those two things are the same should never, ever participate in an economic thread. The reality is that almost every single holding of almost every single person in the US is convertible to dollars. In other words, this is really much ado about nothing. So that is bullshit #2.

3. The article does not suggest that this would cause a crash of any kind. That is bullshit #3

Primavera is a fucking moron. I think we all knew this already.

Con Artist is an ocean going fucking moron, this is what Investopedia has to say.

'Staggering' Volume of Off-Balance Sheet Dollar Debt Is Partly Hidden

The debt, held by non-US institutions, could exceed $80 trillion, says BIS.

A "huge, missing and growing" pile of debt held by non-U.S. institutions may total as much as $80 trillion, according to a report this week from the Bank for International Settlements.

“There is a staggering volume of off-balance sheet dollar debt that is partly hidden, and FX risk settlement remains stubbornly high,” Claudio Borio, head of the monetary and economic department at the BIS, told Bloomberg.

It's mostly held in currency swaps.

KEY TAKEAWAYS

There is currently up to $80 trillion in off-the-books debt held by non-US institutions in the foreign exchange market.

The debt exceeds the stocks of Treasury bills, repossession papers, and commercial papers combined.

The large debt being unrecorded could be bad for policymakers trying to calm the market and prevent a recession.

The debt exceeds the combined value of U.S. Treasury bills, repo, and commercial papers combined, making it difficult for policymakers to recognize where there may be a need for dollars to combat a future financial crisis.

A Dutch pension fund will borrow dollars and lend in euros, later repaying the dollars and receiving back the euros. It's essentially a repurchasing agreement with a currency, and accounting conventions on recording derivatives mean that these swaps aren't recorded.

The FX market is vulnerable to a funding squeeze in times of crisis when dollars are hard to source. In most of these unrecorded exchanges, the U.S. is the lender, with the debt existing internationally.

To avert recessions, the Federal Reserve generally uses currency swap lines to calm the market, as it did during the financial crisis of 2008 and the start of the pandemic in 2020. Debt that's partly hidden means policymakers will be in the dark when making these decisions.

“It is not even clear how many analysts are aware of the existence of the large off-balance sheet obligations,” the BIS wrote in its report. “In times of crises, policies to restore the smooth flow of short-term dollars in the financial system (e.g., central bank swap lines) are set in a fog.”

In breaking down the debt, the bank noted that non-bank institutions outside the U.S. owe at least $26 trillion in debt, double their recorded dollar debt. That's up from the $17 trillion the BIS recorded in 2017. Non-US banks owe an estimated $39 trillion in FX swaps, forwards, and currency swaps.

https://www.investopedia.com/80-tril...corded-6836151

[cancel2 2022]

.
Warren Buffett is alarmed by the economic situation as well, however our financial experts Desh and Con Artist are not. Who are you more likely to trust?

The Warren Buffett indicator takes the Wilshire 5000 Total Market Full Cap Index and divides it by the annual gross domestic product.

It compares the total value of the entire stock market, or the overall stock market capitalization, to the total production of the U.S. economy, which Buffett called “the best single measure of where valuations stand at any given moment.”

It is currently severely over valued as the graph below shows.



https://www.justplainpolitics.com/sh...45#post5394845

[Hawkeye10]

.
Warren Buffett is alarmed by the economic situation as well, however our financial experts Desh and Con Artist are not. Who are you more likely to trust?

The Warren Buffett indicator takes the Wilshire 5000 Total Market Full Cap Index and divides it by the annual gross domestic product.

It compares the total value of the entire stock market, or the overall stock market capitalization, to the total production of the U.S. economy, which Buffett called “the best single measure of where valuations stand at any given moment.”

It is currently severely over valued as the graph below shows.



https://www.justplainpolitics.com/sh...45#post5394845

That the global economic system is ashes might go a long way to explain why Gates el al are buying up so much American farmland. Unlike with a lot of other things the value will never go to $0.

[Text Drivers are Killers]

Personally, I think the Financial World has larger concerns and issues!

Here the Crypto Market is starting to look like a Space Station teetering on the edge of space about to fall back to earth and burn up in the Atmosphere on it's way down.

This is going to cause a chain reaction throughout the entire Funny-Money market.

But for you Masochists and Suicide Kings the price is right- RIGHT NOW!

Cryptos have been a scam all along. They are obviously fiat money backed by nothing.

[Text Drivers are Killers]

That the global economic system is ashes might go a long way to explain why Gates el al are buying up so much American farmland. Unlike with a lot of other things the value will never go to $0.

But you can't use famland as a currency. You can gold and silver. Lithium and platinum too. Oil is too bulky to work as a currency.

[Text Drivers are Killers]

With Armageddon an apparent certainty, it would appear that the time to party is now, no?

HAHAHA. Typical negro response. You "people" never plan ahead. That takes intelligence.

[Text Drivers are Killers]

A crash is the best thing for america. Start over. Bring back the gold standard and send blacks back to africa and illegals back to mexico. Diversity is a horrible idea. So is fiat money.

[Geeko Sportivo]

Cryptos have been a scam all along. They are obviously fiat money backed by nothing.

Can you believe it? WE AGREE ON SOMETHING!

We should do this more often! THANKS MAN!

[cancel2 2022]

A crash is the best thing for america. Start over. Bring back the gold standard and send blacks back to africa and illegals back to mexico. Diversity is a horrible idea. So is fiat money.

It would certainly save a fuckton on the electricity used to crypto mine Bitcoin.

[Flash]

Lol so 50 years later the car still hasn’t started.

No, but he really means it this time. One day it might come true. The Sky is Falling.jpg

[LurchAddams]

I have been reading that China committed the same mistakes we did in 2008. They gave the ability for companies to build homes, apartments, and even cities on borrowed money. Now they are empty and they have no renters. The huge builders are crashing. The banks are too.

The government directed those useless cities be built to manipulate the country's GDP. I saw a documentary on it. Many of the properties were sitting incomplete with no finish work done inside, like plumbing or electricity!

[Stone]

A Dutch pension fund or Japanese insurer could use borrow dollars then lend them as euros or Japanese yen, before later repaying them.

The FX swap market has a history of problems, including funding squeezes during both the global financial crisis and again in the early days of the Covid pandemic, before the Federal Reserve raced to the rescue.

Terrifyingly, the $80trillion-plus "hidden" debt estimate is greater than the total stocks of US dollar Treasury bills, repo and commercial paper in circulation combined, BIS said.

In other words, it's bigger than the mighty dollar.

It has grown from $55trillion to $80trillion in a decade, with daily FX swap deals totalling a massive $5 trillion a day.

Non-US banks and pensions funds have twice as much FX swap dollar obligations as the amount of dollar debt that is listed on their balance sheets.

When quoting SOMEONE ELSES work you are supposed to not only use quotation marks but also include a link to where you got it from. You arent REALLY tryng to pass this off as something you wrote yourself are you? As if anyone in here would believe THAT! BTW,...what I highlighted in your quote proves you didnt write it. Fucked up AGAIN didnt you Desh.

[evince]

A Dutch pension fund or Japanese insurer could use borrow dollars then lend them as euros or Japanese yen, before later repaying them.

The FX swap market has a history of problems, including funding squeezes during both the global financial crisis and again in the early days of the Covid pandemic, before the Federal Reserve raced to the rescue.

Terrifyingly, the $80trillion-plus "hidden" debt estimate is greater than the total stocks of US dollar Treasury bills, repo and commercial paper in circulation combined, BIS said.

In other words, it's bigger than the mighty dollar.

It has grown from $55trillion to $80trillion in a decade, with daily FX swap deals totalling a massive $5 trillion a day.

Non-US banks and pensions funds have twice as much FX swap dollar obligations as the amount of dollar debt that is listed on their balance sheets.

https://www.express.co.uk/finance/pe...h-meltdown-BIS