The coming monetary CRISIS

Martin Armstrong writes…”The entire problem with this Quantitative Easing has been the plain fact that the government is the biggest debtor. This is the same model around the world. Lowering interest rates to encourage people to borrow is absurd when the greatest impact will be upon the government. Europe is now on life support thanks to the ECB. Even if we look at the United States, every 1% rise in interest rates adds $220 billion annually to America’s deficit. Since we have exceeded the Bullish Reversal on Fed Rates on an annual basis ( martin’s proprietary model) , reaching the 5% level means the annual interest expenditures will be rise by about $1 trillion per year! This is just not a system that has much life expectancy before we enter a major Monetary Crisis that is off the charts”.

ECRI has also come out with its weekly leading index and it shows, growth is sharply cooling off which will ultimately lead to lower corporate profitability along with lower tax collection exactly at the time US will be running a trillion dollar budget deficit

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I wanted to conclude this article with the stupidity of politicians from Illinois, the city which is so broke economically that, they want to now impose an EXIT tax for anyone who dares to think about leaving the state . Such a tax may make others decide NOT to move to the state and then watch property values also crash.