The bond market is going to crash in way that no one thought possible . – A very well-connected Wall Street insider and a friend of mine for over 20 years
I have been warning anyone who wants to listen to get out of the bond market. We are being given point-blank warnings from the elitists. Two more huge warning flares were sent up this morning.
The BIS – Bank for International Settlements, the Central Bank of global Central Banks (i.e. the Fed answers to the BIS) – warned in its latest annual report that global credit markets “are once again in risky territory:”
The BIS focused mainly on fresh accumulation of new corporate and sovereign debt by asset managers rather than banks and scratched its head about the coincidence of sub-par economic activity and record low default rates that in turn depress borrowing rates and credit spreads ever lower nearly everywhere.
“Asset managers” means the mutual bond funds you are invested in with your financial advisor or your 401k plan. Get out of them. Here’s the article link: Scoping The New Subprime As Watchdogs Cry “Bubble.”
Ironically, a Portuguese bank, Banco Espirito Santo SA missed a bond payment and its bonds did a cliff-dive (source: Zerohedge):
You see that graph? That’s what the graph of Enron looked like before it collapsed. This is what the entire bond market will look like when the derivatives bombs start to explode. Here’s the Bloomberg article link on the situation: Espirito Santo Bonds Tumble.
What’s missing from the analysis is the OTC derivatives that are tied to the credit condition of this bank. The Bloomberg article mentions credit default swaps but doesn’t explain the implications. The implications are that somewhere, some bank or asset manager is on the hook for any “insurance payments” that will need to be made as part of the bet that was made when institutional investors and Wall Street banks placed their bets on Portuguese banks using OTC derivatives. Eventually someone on the hook for the payment won’t be able to make it and the fun begins. This is exactly what happened with AIG/Goldman Sachs.
It is THIS risk that is hidden away and deeply embedded in the bond market. It is hidden in your bond funds that your “trusty” registered financial adviser with fancy initials after his/her name put you into. You are exposed to this catastrophic risk. In just five minutes of using Google, I found several Black Rock bond funds that are exposed to Portuguese debt. Your genius adviser probably has you in one of these funds.
The bottom line is that you need to get out of your bond funds now before your money gets trapped and destroyed. My co-producer and I did a video explaining why your money will get trapped in bond funds: Get Out Of Your Bond Funds Now.
We are working on a multi-part series that will explain all aspects of why the insiders are terrified of a nuclear melt-down in the bond markets.
The only way to protect yourself from the coming destruction of the bond market is to move your money into physical gold and silver. If you want to try and get rich off of this, you need to own junior mining stocks. Not many people outside of the gold investment community is talking about this sector. But gold was the best performing investment in the first half of 2014 and silver was third (oil was 2nd). All three beat the S&P 500.
I have four great junior mining stock ideas available here: Junior Mining Stock Research Reports. I’ll hopefully have another one up later this week plus an added feature.
Whenever destroyers appear among men, they start by destroying money, for money is men’s protection and the base of a moral existence. Destroyers seize gold and leave to its owners a counterfeit pile of paper. – Ayn Rand (“Francisco d’Anconia”), “Atlas Shrugged.”