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Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So

 
dr0id

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03/22/2022 12:22 PM

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Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
I Know You Don't Think So. You're Wrong
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Powell once again jawboned Monday, stating that "he knows"
inflation is "much too high" and that The Fed "will" act as
required to stop it.

First comes the jawbone. Then, if it doesn't work (and it
won't in this case) comes the action.

No folks, rates are going up and the bond portfolio is going down.

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https://imgur.com/sNWtc9l

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Last Edited by dr0id on 03/20/2024 09:44 PM
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dr0id  (OP)

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03/22/2022 12:24 PM

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
https://imgur.com/fstBy56

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Last Edited by dr0id on 03/22/2022 12:25 PM
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dr0id  (OP)

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03/22/2022 12:27 PM

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
https://imgur.com/a/IPGGEV5

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"Lenin was certainly right. There is no subtler, no surer
means of overturning the existing basis of society than to
debauch the currency
. The process engages all the hidden
forces of economic law on the side of destruction, and
does it in a manner which not one man in a million is able
to diagnose
."
~John Maynard Keynes, 1919
[link to en.wikiquote.org]


"There is no means of avoiding the final collapse of a boom
brought about by credit expansion. The alternative is only
whether the crisis should come sooner as the result of
voluntary abandonment of further credit expansion, or later
as a final and total catastrophe of the currency system
involved."
~Ludwig von Mises, 1929
Chapter XX: Interest, Credit Expansion, The Trade Cycle, § 8
: The Monetary or Circulation Theory of the Trade Cycle


Gas Gas Gas Inflation Meme

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Anonymous Coward
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03/22/2022 12:29 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
how's Kat and the rat doing

Anonymous Coward
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03/22/2022 12:32 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
lol,they could turn it all around with my project but they chose to crash it on purpose.
fuckem,its hotdogs and marshmallows time,who has the metal clotheshangers?
Anonymous Coward
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03/22/2022 12:33 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Ofc that's the plan and we are all stupid from the vax
2022 Sucks Too.

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03/22/2022 12:40 PM

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


Bought my first home at 16% interest rate. That said, prices were 5 fold lower. Couldn't even imagine high interest rates and runaway pricing. Bottom line is the future is bleak and were all fucked.
Anonymous Coward
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03/22/2022 12:50 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
To combat inflation interest rates must rise at the same rate inflation does.

Currently thats 7 or 8%.

Not gonna happen.

Inflation for the win. Not gonna stop.

All part of the great reset.
Anonymous Coward
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03/22/2022 12:54 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
To combat inflation interest rates must rise at the same rate inflation does.

Currently thats 7 or 8%.

Not gonna happen.

Inflation for the win. Not gonna stop.

All part of the great reset.
 Quoting: Anonymous Coward 80231300



You might wish to look into what the real inflation rate is, and how they've changed how it is calculated..

popcorn
REaliZe

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03/22/2022 12:59 PM

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
A recipe for disaster.
There's. A. H0le. In. The. Sky.
Anonymous Coward
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03/22/2022 01:04 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
How do they think this would even work? We have the highest debt load in history. They can't raise rates. They will give "lip service" to the idea, but they will never do it.

They will have Biden say "We're a nation that pays it's debts" all the while handing out more and more cash. That's the only lever government has and they dangle it over people's heads like a freaking carrot!

This guy is deluded!
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03/22/2022 01:04 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
They will just continue to do QE bailouts like they did for Obama's economy. Your crap rambler will be worth a million bucks with some Gen Z kid buying it on a 60 year mortgage.
Anonymous Coward
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03/22/2022 01:17 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
The only way I could see this happening is if there were some type of "event" to make most of the assets not worth what people thought they were to allow them to readjust the system.

If homes don't have value, if stock doesn't have value. Something like a Deagel depopulation "event" then maybe they could give these types of protections to get buy-in and go from there.

Outside of that, no way it would ever happen in the current political environment.
Big Duke6

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03/22/2022 01:27 PM

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


These demons don't care. Their money has flooded into hard assets like real estate, and now they need to smash the economy again opening up yet more real estate opportunity.
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
I remember when interest rates were over 20% during Reagan-Carter. 20% interest on $30 Trillion federal debt is more than the GDP can produce in tax revenue. The entire military budget and social security program would need to be eliminated to pay interest on the debt.
Anonymous Coward
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03/22/2022 01:36 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
To combat inflation interest rates must rise at the same rate inflation does.

Currently thats 7 or 8%.

Not gonna happen.

Inflation for the win. Not gonna stop.

All part of the great reset.
 Quoting: Anonymous Coward 80231300



You might wish to look into what the real inflation rate is, and how they've changed how it is calculated..

popcorn
 Quoting: Anonymous Coward 68316327


Yes. CPI is a rigged calculation.
True inflation is probably over 20% and higher for some things
QCluminati

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03/22/2022 01:39 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


20% on your 850k mortgage?
people are gonna burn themselves in the streets

Last Edited by QCluminati on 03/22/2022 01:39 PM
Unvaxxed because fuck you
Anonymous Coward
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03/22/2022 01:39 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Did he say when???

That's the real prediction

bump
NIMST3R

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03/22/2022 01:47 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


yes and it may sound crazy now. But in the 80s 0% sounded crazy also.

They will pull the rug from the housing market.

They will offer refinance to allow you to stay but you lose the title.

Anyone with a mortgage will have no choice but to take that deal.

And all of them "will own nothing and be happy"

People who think they are safe now will sell because the housing market will tank the coming year.

Either way, a moment will come where "cash is king" again. They will be the future if they get in at the right moment. But the window will be small.

You have to get back into assets before they devalue the currency wherever you are. Do not "wait it out".
—— There still is time if you RUN NOW!! —
Anonymous Coward
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03/22/2022 01:48 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
The Fed has only two choices: Choke off inflation or risk societal and government collapse.

I don't think Karl realizes they want collapse. Then they can 'build back better' which really means make your cage stronger and smaller.
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
bsflag
NIMST3R

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


20% on your 850k mortgage?
people are gonna burn themselves in the streets
 Quoting: QCluminati


Then add the reality that that 850K house then will sell for 400K.

And the bank makes that mortgage call for you to drop 450K by monday or they take your house.

This shit will cut from all sides if you dont fully own property.
—— There still is time if you RUN NOW!! —
Anonymous Coward
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03/22/2022 01:51 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


What do the fed inflation rates even do? I know a lot of stuff but not this
NIMST3R

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
America will be hit hardest.

Finding a true price or value of a house will be a shocker.

As most houses are just 2x4s and drywall.

Value : none.
—— There still is time if you RUN NOW!! —
NIMST3R

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03/22/2022 01:54 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


What do the fed inflation rates even do? I know a lot of stuff but not this
 Quoting: Anonymous Coward 80045711


Fed sets the lending rates for banks connected to it.

The banks add a premium and sell it to you.

If it goes up, you pay more for loaning money.

So you can imagine that very quickly all houses at current prices will become out of reach for most people who could still afford it now.

That means the buyer market dries up and at some point people will want to exit and put lots of properties on the market.

But there will be no buyers. So the price needs to come down.

Once people get wind of that trend the floodgates open up.
—— There still is time if you RUN NOW!! —
Anonymous Coward
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03/22/2022 01:56 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


I think so too, then it would destroy the bond and equities markets. About the only thing they can do is default on 75% of US CORP debt and then raise interest rates to 20%
Anonymous Coward
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Did he say when???

That's the real prediction

bump
 Quoting: Anonymous Coward 80674095


How about when hell freezes over?

They are already talking about a "Gas Stimulus Check" to go out to all Americans as I type.

They want "$100 per month for individuals or $200 for couples, with the criteria similar to standards used for stimulus checks. The plan would add $100 for each dependent and would go to families for each month the national gas price exceeds $4 per gallon".

Denninger might as well burn his cash right now! They will never stop.
442

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Remember the usa has to pay on that interest rate as well.

And we can't because the debt is so high
Anonymous Coward
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03/22/2022 01:59 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


What do the fed inflation rates even do? I know a lot of stuff but not this
 Quoting: Anonymous Coward 80045711


Fed sets the lending rates for banks connected to it.

The banks add a premium and sell it to you.

If it goes up, you pay more for loaning money.

So you can imagine that very quickly all houses at current prices will become out of reach for most people who could still afford it now.

That means the buyer market dries up and at some point people will want to exit and put lots of properties on the market.

But there will be no buyers. So the price needs to come down.

Once people get wind of that trend the floodgates open up.
 Quoting: NIMST3R


Hmm so don’t buy a home for at least the decade and sell now? Got it
Anonymous Coward
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03/22/2022 02:02 PM
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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Interest rates would have to go to 20% like back in the 80's to stop this inflation...
 Quoting: ^TrInItY^


Bought my first home at 16% interest rate. That said, prices were 5 fold lower. Couldn't even imagine high interest rates and runaway pricing. Bottom line is the future is bleak and were all fucked.
 Quoting: 2022 Sucks Too.


Last call: buy physical gold and silver
Blenderizer

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Re: Karl Denninger's Prediction: They Will Raise Interest Rates and Collapse the Stock Market to Stop Inflation: "I Know You Don't Think So
Remember the usa has to pay on that interest rate as well.

And we can't because the debt is so high
 Quoting: 442


Yah they do, but they've been rolling their debt ever since Volker raised interest rates to stop the inflation of the 70's. That created a situation where corporations and the government could borrow at lower (cheaper) rates in the future so they could meet principle and interest payments as well as a little more to spend on their frivolous activities

https://imgur.com/OhAoXda


Now we're at the right side of that graph and they can't lower interest rates anymore without going into negative interest rates which destroys capital formation. You need capital formation to justify creating new debt.

So Karl is theoretically correct, they need to jack up rates but they can't pay off existing debts because they can't borrow cheaper in the future so they also have to default on about 75% of existing bonds wiping out the commercial banking system and most retirement funds.
Modeling reality





GLP