I was texting with a friend of mine in America yesterday. He shared with me his perspective which I wrote up here. One thing we both reckon, there are some much tougher times coming in 2024.

In America one can make a 5.5% guaranteed return on bonds, so why would a person invest in the stock market which is risky and volatile. And this thinking is why stock prices have dropped so significantly.

From what I understand around half the stock market is propped up by a bunch of big tech stocks, like Apple, Amazon, Microsoft, Tesla and Alphabet (Google). If one of these were to come off, it would have a big affect on the overall market. I am no expert here, so I could be wrong.

America is now spending more on interest repayments than they spend on the military, say, and old < 1% bonds are maturing and being replaced with 5.5% bonds. America can’t afford the interest, so what do they do? They borrow more money in the form of new bonds to pay for the existing ones. And so expenses keep going up, but Congress refuses to raise taxes, so the deficit keeps growing.

This scheme of borrowing from future productivity worked in the past, but it only works if the economy keeps growing faster than the debt interest. The economy isn’t growing fast enough any more so things are volatile. And interest rates are going to keep going up until Inflation is tamed and that still hasn’t happened. Also, fewer people are paying taxes. The IRS have said they were “surprised” at how little they made in the last year. So many people have retired early. Or died.

My take on it, as always, is that greed has led to this point. Why are the taxes of the rich not raised, for example? It is well publicized that during the pandemic the rich got much richer and the masses needed all kinds of aid to stay afloat.

And then there is this maniac – if he becomes President of America again I think the world will wobble big time. This lunatic has divided America and he is angry and vengeful. God help us all if becomes the President again.