Weekly Recap - 09.10.2023

🏦Banks:

👉🏽Metro Bank suspended trading after a 29%+ plunge on Thursday, due to an attempt to raise £600M ($727M) in debt and equity, per CNBC. 

👉🏽Kevin McCarthy has been removed as US Speaker of the House. This makes him the shortest-serving Speaker of the House since 1876. He is also the first ever Speaker of the House to be removed.

👉🏽FED’S POWELL: THE FED’S FOCUS IS ON A HEALTHY ECONOMY.
Healthy economy:
Net worth top 0.1%: $18.6 trillion
Net worth bottom 50%: $3.6 trillion
Household count in the top 0.1%: 132,262
Household count in the bottom 50%: 66,050,020

A healthy economy, right? Look how skewed that number is toward the top .1%.
So yeah healthy economy for the top 0.1%

Example:
Dianne Feinstein had +$100m in assets when she died.
– $60 million private jet
– $21 million mansion in San Francisco
– $7.4 million house in Washington
– $5 million house in Hawaii
– $70 million in CASH
She made $200k a year in salary.

Who was Feinstein? Dianne Goldman Berman Feinstein was an American politician who served as a United States senator from California from 1992 until her death in 2023. Remember she made $200k a year in salary. See the system works? Healthy economy!

👉🏽US National Debt jumps $275 BILLION in a single day. It has increased by 448B in the last two weeks alone.
A SINGLE DAY, that’s more than half of Bitcoin’s entire market cap in debt. That’s something like 10 million
BTC. And yet there are still people who are unsure if $27k is a good price to buy.
Total US debt is now $33.513 trillion, hit $33 trillion just 3 weeks ago. That’s $28.5 billion in new debt per day, and on pace to add another trillion in 1.5 months.

“US national debt has been growing faster than GDP for nearly 10 years. However, US national debt is now growing faster than GDP by its largest margin in history. As of 2 weeks ago, the national debt crossed $33 trillion, nearly 124 times as big as it was 70 years ago.”- The Kobeissi Letter

👉🏽Treasury 30-year yield rises to 4.856%. Highest since 2007.
The long bond yield is now up 55 bps in 13 trading days. “Something is breaking in financial markets. 10y yields have jumped by 150bps in the US and 80bps in Germany. The yield curve has bear-steepened to a more normal level. Getting used to a more typical rate structure doesn’t sound like such a terrible thing. But after 15 years of living in an unnaturally low rate regime, normal sounds, well, abnormal.” – Holger Zschaepitz

As yields continue spiking, losses on US Treasuries have reached $1.619 trillion.

Sven Henrich: Perfect doom loop: Yields keep rising because they need to issue so much debt above plan. And they need to issue so much debt because higher yields have resulted in escalating higher interest payments on debt. So they need to issue even more debt which causes yields to rise even higher causing ever larger interest payments resulting in ever more debt needed to be issued which causes even higher yields and so on. Eventually, rising yields would lead to a complete bust. They’re trapped and need lower yields to get out of the doom loop. All roads lead to intervention.”
https://twitter.com/NorthmanTrader/status/1709254206379454938

👉🏽”Job openings in August just unexpectedly jumped from 8.92 million to 9.61 million. This jump of 690,000 job openings is the biggest since July 2021. Not to mention, July 2023 job openings were revised HIGHER from 8.81 to 8.92 million. The beat on expectations of job openings is the biggest beat since September 2022. This is the last thing the Fed wanted to see. Higher for longer is alive and well.” – The Kobeissi Letter

👉🏽’Credit card debt exploded by $14.68 billion last month. This happens at the end of every cycle—when personal savings are drained, and people take out new credit cards they don’t intend to pay back. A classic blow-off top in consumer credit is underway, you know what happens next” Joe Consorti

So what happens next? Recession

👉🏽Last week I mentioned that “the Canadian government, armed with one of the world’s most repressive online censorship schemes, announced that all “online streaming services that offer podcasts” must formally register with the government to permit regulatory controls. Basically, Trudeau is trying to crush free speech in Canada. May I remind you that Canada is a G7 nation.”

New laws in Canada are affecting what news outlets and news stories are allowed to be consumed. For example, Bloomberg is considered controversial and the Canadiens are unable to view it. WTF!

👉🏽Turkey’s inflation tops 60% despite massive interest rate hikes as oil surge worsens outlook. Turkey’s inflation is the result of previous broad money expansion. And yet the people are still voting for Erdogan.

👉🏽In Germany, the construction sector is really crashing. The German PMI Construction Index fell to 39.3 in Sep from 41.5 in Aug, the lowest level since statistics began.

👉🏽”As geopolitical tensions now spread across the Middle East, oil prices are likely to spike even further. Meanwhile, the US Strategic Petroleum Reserves (SPR) have 17 days of supply remaining, their lowest in history. This is roughly half the historical average of ~33 days dating back to 1990. Furthermore, this week OPEC reaffirmed their commitment to over 1.5 million barrels per day of voluntary production cuts. All while Russian exports of crude oil are being limited and the world’s largest oil producers are at war. There has never been a worse time to have a depleted SPR.”- The Kobeissi Letter

So what is the SPR? The U.S. Strategic Petroleum Reserve (SPR) is the world’s largest emergency oil stockpile. Established in 1975 after the oil embargo.

👉🏽 Meanwhile here in Europe, Lagarde is in Lalaland. ECB President Lagarde says she is positive about the ECB meeting the 2% inflation target and Europe’s gas reserves, per Reuters.

👉🏽 “Average interest rate on a 30-year mortgage rises to 7.93%, its highest since July 2000. Since January 2021, less than 3 years ago, interest rates have gone from 2.65% to 7.93%. This means that homebuyers just 3 years ago would see their interest rate TRIPLE if they decided to move. This is exactly why existing home sales are at their lowest since 2010. The average new home is about to cost LESS than the average existing home for the first time since 2005. You know something is wrong when old costs more than new.” – TKL

The median monthly home payment in the US rises to an all-time high of $2,839/month. According to Reventure Consulting, the median home payment has now gone from $1,035/month to $2,839/month in just 10 years. Sjeezzz! :S

I end this Weekly Recap with the following tweet by Pierre Rochard:

“The $33 trillion national debt and $2 trillion annual deficits are odiously immoral and economically unsound. They represent a multi-generational and bipartisan failure of leadership. But they’re also inevitable with a fiat system. Only Bitcoin fixes this, not politics.”

“The remarkable thing about Bitcoin is that despite the internal disagreements, it continues to work flawlessly. That, in essence, is the crux of it. I am 99.9% confident that within my lifetime, Bitcoin will be recognized as one of the most significant discoveries in human history. Bitcoin maximalists have been consistently right in their predictions.”

Credit: I have used multiple sources!