If ever we needed proof of the saturation-level brainwashing to which the Western masses are now subjected (and to which they have succumbed), there is no clearer evidence than the U.S. Treasuries market.
The U.S. economy has never been less-solvent in its entire history, meaning that U.S. Treasuries have never been less valuable. The new supply of U.S. Treasuries grossly exceeds any level of paper the U.S. has ever pumped into global markets before, meaning that Treasuries have never been less valuable. And yet we see (alleged) buyers being permanently willing to pay (by far) the highest prices in history for these mountainous stacks of paper.
However, this is just the beginning of the absurdity here. We’re told that the U.S. government can continue to obtain these record prices despite the fact that the two largest buyers of Treasuries over the past decade (China and Japan) have virtually stopped buying. Indeed, for more than a year China has been a net-seller of Treasuries. This collapse in demand also implies the lowest rather than the highest prices in history for U.S. Treasuries.
Amazingly, we have now journeyed beyond absurdity. With U.S. Treasuries interest rates having literally dipped into negative numbers on several occasions already, absurdity becomes insanity: “buyers” supposedly paying for the privilege of lending money to the U.S. government.
Under the best of circumstances this would be perverse and insane. Borrowers do not get to charge lenders interest when they borrow their money. Indeed, the simple fact that this point even needs to be made – to an adult audience – is proof of how this saturation propaganda has effectively rendered the majority brain-dead.
Lenders do not pay interest to borrowers when they lend them money.
This is a tautology of commerce which is true under the best of circumstances. However we are far from “the best of circumstances.” The United States has never been less solvent, meaning its bonds have never been worth less (worthless?). And now we have the ultimate insanity.
We have the Treasury Department announcing it is formally structuring its bond auctions to make it easier for “buyers” to pay negative interest rates (i.e. pay the U.S. government in order to be allowed to lend it their money). The King of Deadbeats, the most insolvent nation in all of history, has announced that it is now expecting lenders to line-up in order to be allowed to pay the U.S. government for the privilege of lending money to it.
In short, the U.S. Treasuries market is already totally perverse. There is not even a hypothetical universe we could construct where this would be a rational, legitimate market. The only parallel I can think of is a fable I heard long ago about “The Mythical Land of Us”.
The Land of Us was a rather dreary place. It was composed entirely of two groups: a small number of rich Hogs and a huge herd of poor Sheep. Inexplicably, it was the sheep themselves who always chose the Hogs to rule over them.
The Land of Us became such a dreary place entirely because of its Golden Rule (one of the first laws created by the Hogs): “All of the Sacrifices will be bestowed upon the Sheep, and all of the Privileges will be imposed on the Hogs.” The Sheep agreed that this seemed like a very equitable division. [Did I mention that the Sheep weren’t very bright?]
However, even the fat Hogs weren’t smiling these days as The Land of Us had a very serious problem: it was deeply, deeply in debt – in fact hopelessly insolvent. Worse still, there were practically no revenues coming into the Hogs’ coffers. The Sheep had nothing left to tax, while naturally the Hogs paid no taxes (as per the division between “Sacrifices” and “Privileges”).
An emergency Council of the Hogs was convened to discuss this crisis.
“Fellow Hogs,” addressed Boss Hog, “We cannot continue things this way any longer. We’re already deeply in debt to neighbouring lands, and worse still, the Great Trough is nearly empty.”
Grunts of shock and horror reverberated amongst the Swine.
“Let’s raise the taxes on the Sheep,” sneered one of the fatter Hogs, echoed with many grunts of approval.
“That won’t work,” replied Boss Hog, “We’ve already squeezed the Sheep dry.”
“We could start paying taxes ourselves…?” suggested one of the younger, thinner Hogs, naively. Raucous laughter erupted throughout the Council.
“Seriously though,” continued Boss Hog, wiping away a few tears, “Something must be done.”
“We’ll just have to borrow a lot more money,” concluded one of the Hogs, with most of the other Hogs nodding in agreement.
“We can’t,” countered Boss Hog, “The other countries can see that Us is insolvent, and no one will lend Us any more money at these interest rates.”
“Then we’ll just have to increase interest rates to attract more capital,” reasoned yet another Hog.
“We can’t do that either,” stated Boss Hog, dejectedly, “With current revenues we can’t even afford to pay the interest on all our old debts. Indeed, we need to find some way to lower our interest payments – or we’ll soon be bankrupted by our old debts alone.”
“What if we just printed-up a huge, new stack of Piglets – and used all those Piglets to ‘buy’ our bonds,” suggested another Hog hopefully. [The “Piglet” was the official, paper currency-unit of the Hogs.] “Then we could set marginal interest rates to any number we wanted because we would be ‘selling’ to ourselves.”
“That still won’t work,” declared Boss Hog. “Once the other nations saw us printing those trillions of Piglets – and diluting the currency – they would quickly start dumping the TRILLIONS in Piglet-denominated bonds they’re already holding. The Piglet would quickly become worthless.”
“I have a plan,” asserted a particularly sly-looking Hog. “We simply won’t tell the other nations that we’re printing more Piglets to buy our own Bonds – in other words we’ll counterfeit our own currency. And so they can’t see what we’re doing, first we’ll change the procedure on our bond-auctions to make them totally opaque – so that no one can see who is buying the Bonds. This way we can not only claim there are ‘foreign buyers’ for all the Bonds, but we can also set interest rates to any fantasy-number we like.”
“Not even the Sheep are stupid enough to fall for a ruse that clumsy!” scoffed Boss Hog.
“Oh, I think I have just the right Hog for the job,” grinned the Sly Hog. A cacophony of evil laughter begins building in the Council…
B.S. Banker strode up to the Bond Auction Podium. He was a particularly impressive-looking Hog, wearing a pointed Magician’s hat and carrying a glittering magic wand. He gazed into the vacuous stares of the Sheep assembled before him.
“Behold, as I perform great feats of Magic!” proclaimed B.S. Banker, gesturing dramatically with his wand. “Observe the ordinary table on my left, with a large stack of Piglet Bonds piled atop it – indeed, it is the largest stack of Piglet Bonds in history.”
Murmurs of nervousness and shock are heard among the Sheep audience.
“Now gaze in wonder as I make that entire stack of Piglet bonds disappear…and at the highest prices in history!” thunders B.S. Banker, as the Sheep audience gasps in awe.
The lights are then suddenly turned off, and the Auction Chamber is plunged into darkness for ten minutes. Muffled sounds are heard, somewhat like a printing press being operated at maximum speed. The lights go back on.
“…and presto!” declares B.S. Banker triumphantly, “The Piglet Bonds have all disappeared.” He points to a table-top which is now void of any paper.
The Sheep exploded into wild applause, and the funding problem for The Land of Us was solved. The Hogs lived happily ever after.
Of course The Land of Us could never exist, because there could never be a herd as stupid as the Sheep.
Just keep telling yourself that each and every time you hear the words “highest prices in history” and “maximum supply” used in the same sentence with respect to a Treasuries auction. Yes, obviously official U.S. Treasuries auctions cannot be nothing more than a Machiavellian scheme to launder counterfeited currency.