Coronavirus and Credit - A Perfect Storm

Alasdair Macleod, Quinton Hennigh & John Kaiser are this week's guests on the radio program.

 

Americans long ago stopped worrying about Federal deficits premised on the view that the world will forever need dollars. But what happens if the Coronavirus leads to massive global supply disruptions, the global economy enters a recession and the U.S. debt to GDP reaches historically dangerous levels? With plunging liquidity resulting from a recession and growing bankruptcies, the only way the U.S. will fund its deficits is via the Fed forcing trillions of phantom dollars into the system driving interest rates deeply into negative territory, thus diminishing demand for dollars in favor of tangible assets. With the purchasing power of the dollar in decline, an inflationary depression will ensue. Alasdair explains these dynamics.

 

Quinton explains why Irving's Omu project in Japan is highly prospective despite narrow high-grade, gold-hosted veins and John shares a favorite investment idea or two.