Dasein.ai

@dasein236

Joined May 2020

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58 Followers

604 Posts

dasein236 retweeted

ZERO IKA 🗡️

@IamZeroIka

over 1 year ago

- Macro talks: economy, outcomes and personal ideas - (semi-long post, it's my style, you know) I believe it's time to shift to a broader perspective, something I don't often do, but which can provide "extra sauce" insights, especially when integrated with the price action, like the cheese on the Maccheroni. As you know, I’m not optimistic about the near future for the global economy, particularly due to the challenges the U.S. is currently facing. This situation, however, remains largely ignored, like a slow poison devouring from within. Back in March, I highlighted this potential scenario, particularly the risks tied to U.S. debt, an issue that looms over the country like the Sword of Damocles, waiting to strike on Uncle Sam's head: https://t.co/nsPTSZROZ0 And since a lot of time has passed, I guess it's time to dive a little bit more trying to help you understand what is happening and what can happen in the future, finding outcomes to prevent what, to me, seems inevitable. But let's proceed step by step. The U.S. national debt back in March amounted at 34T while now stands at more than 36T, a +2T increase and a data that you can consult live on this site: https://t.co/8DciOfW7cm "Brother, I didn't applied for Goldman Sachs, can you make me a lesson about economy and the implications that the U.S debt will have?" Sure my friend and in this sense it's important to understand the relationship between debt and debt ceiling. The U.S. debt represents the total money the government owes, while the debt ceiling is the legal limit on how much it can borrow to meet its existing obligations. The debt ceiling is one of the most significant political issues in America today and, by extension, in the entire Western world. While it has always been a crucial topic, it has gained particular prominence since 2023, when the decision was made to suspend it until January 2025 and this is why it is especially relevant now. The "debt ceiling" is the maximum amount of money the U.S. government can borrow to fund its operations and meet its financial obligations. The government finances its activities through tax revenues and the issuance of government bonds, however, for quite some time, U.S. government spending has exceeded its revenues, leading to the accumulation of debt. "Why I should care about this, mate?" Because if the debt ceiling is reached, the U.S. Treasury Department can no longer issue new bonds, meaning it cannot raise the necessary funds to cover the budget deficit and without these funds, the government would struggle to operate effectively, as tax revenues alone are insufficient to finance total expenditures. If this situation persists, it could lead to a government shutdown and, ultimately, default. This is why the decision to suspend the debt ceiling in 2023 was made: to keep the system running smoothly. However, there is a significant "downside" to this approach. Suspending the debt ceiling is not a permanent solution because allowing debt to grow indefinitely also carries the risk of default. An unchecked increase in national debt erodes confidence in U.S. Treasury bonds, pushes investors to demand higher yields, and raises borrowing costs for the government. If this trend continues, it becomes unsustainable, forcing the government to allocate an increasing share of its budget to interest payments rather than essential public services. This could lead to the same financial crisis the debt ceiling was meant to prevent. There is no perfect resolution to this issue: every option holds a "hidden venom". Over time, the U.S. has managed to maintain a delicate balance, avoiding default primarily due to the hegemony of the dollar and its strong economy. These factors have allowed the U.S. to sustain debt levels that would be unmanageable for other nations. However, this equilibrium is very delicate and I think we're sitting on a "time ticking bomb" ⏰ All of the political strategies adopted by the U.S. will never solve this issue but instead will just postpone it. While it is impossible to predict exactly if or when a U.S. default might occur, there are several plausible triggers: - A global black swan event or a major crisis specific to the U.S. (debt like pointed out back in March?) - Economy slowdown or new economies taking over - Loss of confidence in the U.S. dollar Regarding the last point, especially, I elaborated a theory 2 years ago about BRICS and its implications on the U.S dollar, something you can see right here and it's valid to consider, in my opinion: https://t.co/S2FrYYmHxO "Brother, stop making the professor, tell me what I can do and how I can help myself surviving please.." I can't tell you what to do, but I can tell you what I will do. Personally speaking I will mostly remain liquid, diversifying my "liquidity sources" while eyeing the SP500 (anti-aging/green sector are in my interest) and the crypto market for future opportunities. Gold, silver, and commodities will always remain under my magnifying glass. Logically, the strategy is based on my expectations written here: https://t.co/Qs4H2SUyND and I don't know what will surely happen, I work step by step with the help of price action that alone tells me almost everything, so I will be ready to re-consider my main thesis if it changes, but you also need to be exposed to a side or another I guess, right? The goal of this post remains to stimulate your mind and not to act as "everything is overly bullish so I will go all-in" but to consider all the potential risks involved. Hope you appreciate the post.

IamZeroIka's tweet photo. - Macro talks: economy, outcomes and personal ideas - (semi-long post, it's my style, you know)

I believe it's time to shift to a broader perspective, something I don't often do, but which can provide "extra sauce" insights, especially when integrated with the price action, like the cheese on the Maccheroni.

As you know, I’m not optimistic about the near future for the global economy, particularly due to the challenges the U.S. is currently facing.

This situation, however, remains largely ignored, like a slow poison devouring from within.

Back in March, I highlighted this potential scenario, particularly the risks tied to U.S. debt, an issue that looms over the country like the Sword of Damocles, waiting to strike on Uncle Sam's head:
https://t.co/nsPTSZROZ0

And since a lot of time has passed, I guess it's time to dive a little bit more trying to help you understand what is happening and what can happen in the future, finding outcomes to prevent what, to me, seems inevitable.

But let's proceed step by step.

The U.S. national debt back in March amounted at 34T while now stands at more than 36T, a +2T increase and a data that you can consult live on this site: https://t.co/8DciOfW7cm

"Brother, I didn't applied for Goldman Sachs, can you make me a lesson about economy and the implications that the U.S debt will have?"

Sure my friend and in this sense it's important to understand the relationship between debt and debt ceiling.

The U.S. debt represents the total money the government owes, while the debt ceiling is the legal limit on how much it can borrow to meet its existing obligations.

The debt ceiling is one of the most significant political issues in America today and, by extension, in the entire Western world.

While it has always been a crucial topic, it has gained particular prominence since 2023, when the decision was made to suspend it until January 2025 and this is why it is especially relevant now.

The "debt ceiling" is the maximum amount of money the U.S. government can borrow to fund its operations and meet its financial obligations.

The government finances its activities through tax revenues and the issuance of government bonds, however, for quite some time, U.S. government spending has exceeded its revenues, leading to the accumulation of debt.

"Why I should care about this, mate?"

Because if the debt ceiling is reached, the U.S. Treasury Department can no longer issue new bonds, meaning it cannot raise the necessary funds to cover the budget deficit and without these funds, the government would struggle to operate effectively, as tax revenues alone are insufficient to finance total expenditures.

If this situation persists, it could lead to a government shutdown and, ultimately, default.

This is why the decision to suspend the debt ceiling in 2023 was made: to keep the system running smoothly.

However, there is a significant "downside" to this approach.

Suspending the debt ceiling is not a permanent solution because allowing debt to grow indefinitely also carries the risk of default.

An unchecked increase in national debt erodes confidence in U.S. Treasury bonds, pushes investors to demand higher yields, and raises borrowing costs for the government.

If this trend continues, it becomes unsustainable, forcing the government to allocate an increasing share of its budget to interest payments rather than essential public services.

This could lead to the same financial crisis the debt ceiling was meant to prevent.

There is no perfect resolution to this issue: every option holds a "hidden venom".

Over time, the U.S. has managed to maintain a delicate balance, avoiding default primarily due to the hegemony of the dollar and its strong economy.

These factors have allowed the U.S. to sustain debt levels that would be unmanageable for other nations.

However, this equilibrium is very delicate and I think we're sitting on a "time ticking bomb" ⏰

All of the political strategies adopted by the U.S. will never solve this issue but instead will just postpone it.

While it is impossible to predict exactly if or when a U.S. default might occur, there are several plausible triggers:

- A global black swan event or a major crisis specific to the U.S. (debt like pointed out back in March?)
- Economy slowdown or new economies taking over
- Loss of confidence in the U.S. dollar

Regarding the last point, especially, I elaborated a theory 2 years ago about BRICS and its implications on the U.S dollar, something you can see right here and it's valid to consider, in my opinion:
https://t.co/S2FrYYmHxO

"Brother, stop making the professor, tell me what I can do and how I can help myself surviving please.."

I can't tell you what to do, but I can tell you what I will do.

Personally speaking I will mostly remain liquid, diversifying my "liquidity sources" while eyeing the SP500 (anti-aging/green sector are in my interest) and the crypto market for future opportunities.

Gold, silver, and commodities will always remain under my magnifying glass.

Logically, the strategy is based on my expectations written here: https://t.co/Qs4H2SUyND and I don't know what will surely happen, I work step by step with the help of price action that alone tells me almost everything, so I will be ready to re-consider my main thesis if it changes, but you also need to be exposed to a side or another I guess, right?

The goal of this post remains to stimulate your mind and not to act as "everything is overly bullish so I will go all-in" but to consider all the potential risks involved.

Hope you appreciate the post.

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