Submitted by Chris Martenson of Peak Prosperity Paul Brodsky: Central Banks Are Nearing The ‘Inflate Or Die’ Stage"It’s impossible to have a political solution to a balance sheet problem" says Paul Brodsky, bond market expert and co-founder of QB Asset Management. The world has simply gotten itself into too much debt. There are creditors that expect to be paid, and debtors that are having an increasingly difficult time making their coupon payments. No amount of political or policy intervention is going to change that reality. (Unless a global "debt jubilee" transpires, which Paul thinks is unlikely). Looking at the global monetary base, Paul sees it dwarfed by the staggering amount of debts that need to be repaid or serviced. The reckless use of leverage has resulted in a chasm between total credit and the money that can service it. So how will this debt overhang be resolved? Central bank money printing — and lots of it — thinks Paul. At this point, the danger posed by the instability of our monetary and fiscal house of cards is so great that trying to time an investment program to when this avalanche of printing will occur is too risky, in Paul’s opinion. It’s time to shift your remaining capital into hard assets and sit on the sidelines to watch the carnage play out. On The Imbalance Between Debts and Money Supply We are seeing — not only in the US but in Europe and in Asia, as well — separating bank assets and base money. Base money is comprised of currency in circulation plus bank reserves that are held at central banks — at the Fed or that is at the ECB, the Bank of Japan, so on and so forth. This is how the global economy rolls, as they say. Bank assets are loans mostly. And the amounts globally are staggering: something approaching $100 trillion in global bank assets. And in the US we think that is somewhere around $20 trillion held in the US and abroad. And the numbers for the monetary base are much, much lower.
http://www.zerohedge.com/news/paul-brodsky-central-banks-are-nearing-inflate-or-die-stage