Personal Comment: As this first post is rather unusual and long, you are invited to read it on my blog for better readability: https://cryptoyoda1338.com/2020/03/17/the-great-silence/
And then, quite suddenly, one day in late March with the beginning of spring, the world fell into great silence.
After years and decades of aggressive overexpansion, ever-increasing production and exploitation of the planet’s finite resources for the greater good of a never-stopping globalization – at last – the great gear wheel of the world came to a to a sudden halt. This is the record of the Great Silence and the events that followed after the great shutdown of the year 2020…
– This or something similar might be the beginning of a book published in 2030 describing the rather dramatic events that unfolded after the world economy came to a grinding halt, and how people reacted to it. Quite dramatic certainly, but not necessarily an unrealistic narrative.
But for now, let us return to our time. Right now we are witnessing a challenge of paramount proportions, not only as individuals, but as a global collective. For the first time ever, unprecedented in human history, our everyone’s fate has become so intertwined that we will share the same destiny no matter which path we take from here. For doom or gloom, for better or worse, we are now asked to change our ways as a global society, or face the slow and painful disintegration and eventual destruction of our species.
Sounds dramatic? Sure does, but it is not as unlikely as it sounds. Almost two years ago I put forth a warning in my article “The Inevitable Crash of the Century” in which I elaborated on the inevitableness of a complete meltdown of the global, interconnected economy and the potential consequences resulting from such scenario. Although a little off in timing (the bubble didn’t pop but ended up growing for two more years instead) the article nonetheless contains the key elements and -reasons for a system-wide collapse – an opinion based on several hundreds of hours of solid, passionate and well-founded research. Many have doubted that such a scenario is likely, even thinkable and outright critized me for even daring to write such scenario might come to fruition. But then again most people don’t dare to invest hundreds of hours of their precious lifetime in such things as understanding the economic system the world is built upon, and only few of those who do, dare to speak publicly about it for reasons in plain sight.
Anyhow, the world is tumbling, and we all feel it. No matter in which country on this planet you live in right now, we all realize that something is happening that is beyond our individual control. And while we do not fully understand the scope and implications of these happenings, we begin to grasp that we are no longer in a power position, but in a position of passively waiting for something to happen, hopefully not for the worse. Yet slowly but surely we seemingly lose the very control we fought so hard to maintain in recent decades. Perhaps it is time to rethink.
Understandably, the confusion and helplessness, restlessness and uncertainty is high these days, and nobody can be blamed for feeling that way. The feeling to see everything we understood as normal now being on the verge of crumbling down is a hard pill to swallow. Perhaps we slowly come to realize that the foundation we built upon was quicksand after all. With an invisible pandemic spreading through the world, and collapsing financial economies all over the place we seemingly realize that the ship we used to navigate is sailing into a storm of unknown peril and distress, way beyond our control, while the sole question remains: Who is the captain now?
In times like this, no matter the catalyst, there is no better way to assess the economic turmoil in the world than to look at the global markets directly. Whether or not the virus is man-made or not is not even overly relevant. No matter if true or fake, man-made or not, the consequences will be felt like shockwaves around the globe. And most evidently, as usual, it will first make its appearance in the financial markets before it ripples down into our personal daily lives.
Let us together look at the biggest economies of the world and their performance over the last few weeks, to paint an accurate and objective picture of what is happening right here right now in front of our eyes, whether we want to realize it or not.
Measures the stock performance of the 500 largest companies listed in the United States
When looking at the SPX500 it becomes evident that things have changed. Despite major government interventions and enourmous injections of billions of dollars into the financial markets to rescue the economy, the meltdown could not be prevented, merely slowed down. Even the most gigantic dollar printing machine seems useless in face of global distress and panic. The propping up of financial markets by printing vast amounts of fiat worked for decades – way longer than it should have – but now this last of all emergency measures, too, seems to fail.
Of course this development is not limited to the United States, but happening all over the world. Lets take a look at the German DAX which is the economic powerhouse of the European Union.
Stock market index consisting of the 30 major German blue chip companies
Being down about 40% in just five weeks, erasing gains of more than six years of growth, the DAX shows in an alarming way how critical the situation is at the markets. Whoever bought & held DAX contracts after September 2013 is now holding a losing position, putting further selling pressure on the market, as one after another has to eventually cover positions and limit their losses or risk getting liquidated by continued down moves in the future.
Such drastic change in the market environment is however not limited to traditional stock markets, but hit all markets equally.
Precious metals did not get spared on these developments with Gold being hit down 14% in less than three weeks, much to the distress of investors having looked at Gold as the ultimately safe haven ever since. While performing relatively “good” in comparison (calling a -14% performance “good” shows the desperation of the situation at the markets) to the rest of global markets, signs of a local top are imminent. Although the medium-term uptrend seems yet to be intact by definition, both volume, price action and selling pressure indicate a top for the time being and impies further correction is needed after this failed attempt to break All Time High during this past run-up.
Silver got even hit harder, being down 37% in four weeks, thereby breaking a massive 67-month trading range to the downside. Whether or not Silver will manage to remain above the single digit mark will show in the coming weeks and months.
As the leading cryptocurrency Bitcoin fell a staggering 63% in the course of just five weeks after it failed to sustain prices about the significant $10,000 mark, it once again dragged down the rest of the crypto market with it. Being down -30% Year-to-date in spite of major global turmoil, the narrative of cryptocurrency as a safe haven seems to have faded for the time being, further dampening investor’s enthusiasm. However with the Halving now being less than two months away, in other news investors cherish the opportunity to gobble up coins at a relatively low rate, speculating on both increase in demand as well as cut in supply.
Global Overview of Major Economies
Japan, India, China and UK
The world has changed, and charts rarely lie. With basically most of the major traditional, metal and crypto markets being down by a third or a even half in a span of just four weeks – without significant signs of an immediate comeback – there is indeed reason to worry whether the global economy is prepared and/or able to recover at all.
In such an immensly complex and interconnected world that demands constant growth and never-ending expansion, the system is not and never was designed to withstand a complete halt of the gear wheel. It either keeps going, and keeps going perpetually faster, or the music stops playing. I believe we are in the stage where it is evident that the wheel has already significantly slowed down. We might not know whether or not it will come to a full-halt, but what we see in the markets and what we see in our immediate surroundings is not inspiring confidence. Businesses closing, bankruptcies, large-scale injections of central banks, spiking unemployment numbers. Whether or not the economic wheel now comes to a grinding halt will become apparent soon, and implications will follow suit.
To be frank, the global economy was broken and doomed even before the pandemic began to spread through the world. The virus is not the cause of the global meltdown, but merely the catalyst. That a virus will be the pin that eventually leads to the bubble popping might not have been predictable, but in the end it does not matter for the outcome will be the same. The pressure is on the world and its people now.
While the “Safe Haven” – narrative of both crypto and precious metals as a store of value in times of crisis is seemingly dampened for the moment, this might change soon when the failure of the economy will become more and more evident. Although the situation we are confronted with is several magnitudes more important than the sole and obsessive focus on money, the financial question is one that needs to be asked and answered in due time. But other things should as well be considered.
For the time being I see two ways of moving forward, and both scenarios are largely beyond our control.
The pandemic suddenly and completely fades into non-existence, and within a few weeks we will be back to the old order of things. While people will take this experience as an opportunity to overthink their way of life and to re-organize their priorities and focus in the future, eventually everything will revert back to the mean.
As such, the global economy will return to its old modus operandi. People will get back to their work, recover from their bankruptcies and temporary illnesses, and the prices of assets, stocks and metals will soon have returned to a “normalized” level (whatever that means in a debt-based financial system where money is printed at will).
Within a matter of weeks people will once more find themselves in a perpetual cycle of 50-hour work weeks, pretend to enjoy their time in fancy bars & restaurants, and live a fast and superficial lifestyle while continue to maintain their constant and never-ending busy-ness. And soon, very soon, while they stare into their phone scrolling through just another social media feed, they will have forgotten what once was, in late March of the year 2020.
Due to the condition of the global financial system this scenario is – unfortunately – rather unlikely.
The other scenario is as follows:
Neither the pandemic nor the meltdown of the financial markets will subside, but accelerate. Slowly but surely, the world will move into silence, and life will have fundamentally changed.
In retroperspective, the moment we are experiencing right now will seem like the early beginning, not the peak. How will people react when the world around them continous to utterly crumble apart without any sign of recovery? For those who saw this coming by a long shot the changes will still be tough. But I can only imagine how it must feel for someone who never even thought about the possibility that once in their lifetime the world will completely shut down. There are those who waited all their life for this to be happening, and they will likely be ready for the changes that are coming our way, and of course there are those who are not. I will spare us the elaboration on the potential negative consequences of a prolonged isolation and instead focus on what is paramount:
Don’t fear the virus, nor fear the economic collapse. While the changes will be tremendous, this is not the time to be afraid, for being fearful opens the gates to the darkness. Rather than being fearful we should see this as a wonderful opportunity to reflect and start anew, individually and collectively, if we are open to it, and be prepared to seize the opportunities as they arise. When the world turns into silence, and people are forced to stay at home, will they not have the time and tranquility to rethink and reflect on their situations, how they lived and what is truly important to them? Would a situation like this not inevitably lead to more self-realization, contemplation and stillness, yielding great rewards of clarity & insight? By slowing down internally and externally, will this not be a grand chance in fundamentally changing our ways so when the world opens up again we will be ready to tackle the changes that urgently need to be done?
And are we not yet tired of our old ways? Do we not have seen enough greed, exploitation, violence, decay of moral values and degeneration of society? All this constant chasing and desire for status and money, is the unreached superficiality of recent years not enough? Have we not long witnessed the peak of unseen stupidity and recklessness, egoism and narcism, both in society and global leadership?
On the same token, have we not for too long abandoned the way of light and been ensnared in the ways of darkness? How far down do we still want to go before we take things into our own hands and finally turn this world upside down? How long do we still want to wait and watch the wrongdoings of our people, the social and financial injustice, and utter destruction of the very foundation of life which is our planet? And don’t be mistaken, fundamental change will not come without turmoil. Great change never comes without great volatility of energy. But the opportunity is at hand. And the time for change is now.
Unfortunately my friends, the dark side is awake too. Such magnificence of a chance a global pandemic presents for the ruling class. I can imagine a diversity of consequences to be implemented by governments all over the globe, using the pandemic as an excuse to do so. Perhaps the long-sought abolishment of paper cash, or the overdue implementation of a digital world currency for perfect control? How about forced vaccinations or the ever-expanding means of surveillance and restriction of freedom? You name it. Keep your eyes open.
Independently of what anyone else is saying, I personally believe we are getting close to the Grand Finale of humanity. The next months and years will decide whether we will begin climbing up the evolutionary ladder and become a completely new and evolved species, or whether we will continue our current slow and painful path towards utter destruction. This Finale that we are about to witness will be one of greatest events of human history, and will bring biggest risk and greatest opportunity alike, and when it happens you will either be ready or you will be not.
Have faith and meditate. Know that the Source has your back, and that everything will be fine after all. And know that seeds that are sowed shall be harvested in due time.
Let the truth be told, and may the Source be with you,
PS: As I publish this post the preparation for the next article already begins – stay tuned.