Resource analyst and futurist Chris Martenson says everyone should be taking notice of our “dangerous markets.” At the center of the danger zone is the declining U.S. dollar. Martenson explains, “We are talking about a steady erosion of the dollar as a reserve currency. I think that is most likely. The only thing that could make that really go fast is some kind of war. The United States and China, we got to keep our eye on this because Trump has been threatening a trade war with China. China responded and said if you do that, we may dump the dollar. . . . So, there is all this trade and financial back and forth and maybe even actual war at some point. . . . China has the ability to really impact the dollar in a big way on the world stage. We better hope it does not come to that because a slow erosion we can adjust to; a quick erosion is going to really roil the markets and maybe blow a few of them up.”
Martenson contends the U.S. could see hyperinflation in a short time if China “dumps the dollar.” Martenson explains, “The way that works is let’s say they want to unload $500 billion on some Tuesday morning. Who is going to buy that $500 billion? Who is on the other side of that trade? Well, if there are not enough people bidding for those dollars, the price has to fall until you find enough people to absorb those, and the dollar would fall in value against all other sorts of other things such as other currencies, oil, gold, silver and all those things. . . . We would be looking for a paired event. What we would be looking for is interest rates starting to rise on Treasuries and the dollar starting to fall in value in value against a variety of things. Once we see those two things, we know we have a financial war or a monetary war. . . . That’s what blows up the derivatives market. That’s what makes difficulties for traders. That’s what makes the high frequency computers say I don’t like this and bolt and instantly evaporate from the markets.”
Martenson also points out, “The Dow is hitting all-time highs. So, it can’t be that bad, right? The Dow is used as a signaling device, and it says have faith in your leadership and everything is fine. Under the covers, obviously, things are not fine. The people I talk to are nervous and worried. One reason is because it’s fall, and that is sometimes when we see these corrections, but the other reason is everything we track is getting more and more fragile. These markets . . . are held together by confidence. . . . I can’t tell you the number of people that used to be investors that say they just don’t trust these markets. They are rigged and they understand that. They don’t want any part of that.”
In closing, Martenson contends, “By many metrics, this market has never been more expensive. . . . What goes up has to come down. . . . I am convinced the central banks are so petrified to let a 1% or a 2% correction happen . . . . What does it mean when the central banks are so petrified that they can even allow a correction to get started? That’s what people should be focused on.”
Greg is the producer and creator of USAWatchdog.com. The site’s slogan is “analyzing the news to give you a clear picture of what’s really going on.” The site will keep an eye on the government, your financial interests and cut through the media spin. USAWatchdog.com is neither Democrat nor Republican, Liberal or Conservative. Before creating and producing the site, Greg spent nearly 9 years as a network and investigative correspondent. He worked for ABC News and Good Morning America for nearly 6 years. Most recently, Greg worked for CNN for shows such as Paula Zahn Now, American Morning and various CNN business shows.