11/22/2021 - Yra Harris – Odious, Indeed

“The main concern for the world is not TRADE but the massive amount of DOLLAR-DENOMINATED DEBT. In the last decade, global debt has grown to $330 trillion from $200 trillion, according to IMF, BIS and IIF. The dollar’s status as the world’s reserve currency means a large percentage of the DEBT is denominated in U.S. currency, especially because the Fed’s aggressive QE policy has sustained very low interest rates to enable DOLLAR funding for many emerging market businesses.

Many emerging market central banks have begun raising rates to keep their currencies attractive so as not to create stress for their private sector dollar borrowers. But how high can rates go in Brazil, Mexico, Russia and others before their economies begin to slow?

The Europeans need to be more concerned about its policy of LOWER FOR LONGER sending the DOLLAR to levels that cause global systemic stress in the DEBT markets. Lagarde is pursuing a one-dimensional goal in a multi-faceted world. While some may not think this is ODIOUS it will prove to be reprehensible. Market signaling mechanisms are broken in the face of massive QE purchases so there are no market forces to upset the ECB agenda, or the BOJ’s. The FED is going it alone … maybe. Perhaps it’s time for a G-7 meeting?”

Link Here to the Blog Post

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