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Credit Bubble Bulletin/Doug Noland
“Bubbles and resulting manias take on lives of their own. They cannot, however, escape harsh realities: Fragilities only build up over time, and Bubbles don’t work in reverse. Collapse becomes unavoidable, with any serious de-risking/deleveraging dynamic leading to a contraction of marketplace liquidity, a spike in risk premiums, illiquidity, panic and dislocation. It’s the modern form of the old-fashioned Bank Run. That’s where we are today.”
USAGOLD note: Sounds like the sort of thing the wise investor might consider hedging………Noland goes on to discuss the notion of “globalized bubbles.” Globalized bubbles, it follows, lead to globalized breakdowns that in turn lead to globalized demand for gold and silver. James Ricards warning of last week that there might come a time when investors might not be able to buy gold takes on a greater sense of urgency in this context.
Repost from 3-8-2020