MB Fund Podcast: Debt Deleveraging: is this the big one? (Updated to include podcast audio)

Will Coronavirus cause a debt crisis? And if so, what type of debt crisis?

Ray Dalio has a number of videos and books out talking about the long term debt cycle vs the short term debt cycle. In this episode we have a look at the question of whether this will end another short term debt cycle or if it is the end to the long term debt cycle. Can if be delayed? Can governments kick the can down the road one more time?

Join MB Fund’s Head of Investments Damien Klassen, and Head of Operations Tim Fuller as they cover “Debt Deleveraging: is this the big one?”.

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Tim Fuller is Head of Operations at the Macrobusiness Fund, which is powered by Nucleus Wealth.

 

The information on this blog contains general information and does not take into account your personal objectives, financial situation or needs. Past performance is not an indication of future performance. Tim Fuller is an authorised representative of Nucleus Wealth Management, a Corporate Authorised Representative of Nucleus Advice Pty Ltd – AFSL 515796.

Tim Fuller

Comments

  1. DominicMEMBER

    Is this the big one? Yes or no.

    Personally, this cycle has just about had it. There is only money printing to come, followed by the inevitable failure of fiat.

    • The million dollar question is, have we gone past the point the printing does not work any more?

      • DominicMEMBER

        Money printing never worked in the first place – despite what the Monetarists say. It doesn’t create new wealth, it just re-distributes it. Certainly, printed money has periodically un-gummed the machinery that underlies the fragile financial system and allowed credit markets to function, but it has its costs. The money-printing saga (these days to pay the Govt’s bills) will end when people lose faith in the currency in which they are paid. The rot sets in, beneath the surface, over an extended period and then suddenly bubbles to the surface – at which point it’s game over.

  2. Honestly though, where does a 30-somehting yo stick their Super during times like these? Are there any sectors that the MB fund sees worthy of a toe-dip currently? Great podcast, cheers!

  3. – The crisis hasn’t arrived yet. It will come when (NOT IF) interest rates in the US and the USD “go ballistic”.

        • Thank you for your clarification, bcnich also posted few times that interest rates will go up. I want that to happen too as a saver myself. Just when reading what the Fed is saying and locally what RBA is saying and doing. it seems they are adamant about low interest rates

          • – No, rising interest rates is the last thing you want to happen with our middle class so deeply indebted. It’s a sign the US economy is imploding.

          • DominicMEMBER

            As Willy says, the moment yields start to push higher so economic disaster looms, which is why central banks will have to print huge amounts to compress them again. You can join the dots from there.

        • Interest rates are not/never going up. US Treasuries are predicting negative rates/deflation. We are all Japan now.

          • DominicMEMBER

            Yields are predicting recession and reflect a degree of fear i.e. Treasuries are a place of safety – a cave if you like. Problem is, there’s a deranged bear living in the cave and when it’s discovered those taking refuge will flee.

            Not sure about deflation — in what exactly? Groceries? Fuel? (the price of unleaded locally is already back to pre-Covid levels), Utilities? City rates? My mortgage? These are the things that matter – I couldn’t give a crap whether the latest tech flat-screen TV is now 20% cheaper. It’s irrelevant. Electronics have always been that way anyway.

            The only places there could possibly be deflation are in those assets propped up by large amounts of debt i.e. financial assets, including property. Pretty much all day-to-day cost-of-living expenses will be higher going forward. Renters should be able to get some good deals too.