Sunday, July 03, 2016

Kyle Bass*:
There Is No Way Out
On gold: "They call it the yellow metal that has no yield, but with the entire world going to negative rates, then on a relative basis, it's probably one of the better currencies to own. I buy that wholeheartedly. And seeing which way the central banks are going, you're going to have to own something."
On central banking & financial repression: "This idea of helicopter money, and the idea of banning cash, and all these things that, when you sit here in the cold like that, you can see exactly why they need to do these things. You watch the narrative unfold in the media, and then the trial balloons get floated. But you're right, they have to go to helicopter money, they're really not going to have a choice. And it seems to me that they are going to have to try to ban cash. Because, as you say, the U.S. savings rate has tripled since the financial crisis, and that's literally the last thing they want or need. So is there any way out for these guys? Because that's the thesis that I keep checking. I can't see a way out, absent cold fusion ..  I had a fascinating out of body experience meeting with one of the world's top central bankers in a private meeting about three years ago. And he said, 'You know Kyle, quantitative easing only works when you're the only country doing it.' He would never say that publicly. And I'll protect his name, because it was a private meeting. But it was one of those moments where I...it was one of those epiphanies almost, where it's something you and I knew, but hearing him say it, call it one of the four top central bankers in the world, it was a jarring experience for me, because when I look around the world today, everyone's in the same boat. So we're all trying...we're attempting through our treasury and our Fed to get the rest of the world to not devalue against us, while we quietly attempt to devalue ourselves against them, and it's all this...it is the race to the bottom, it is the beggar thy neighbor policies that we all talk about. And I believe that there is no way out."
LINK HERE to the article

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