Markets flashing 2007 danger zone

Added: 2026-05-21

[00:00:00]Okay, so we've got to talk about the markets and the economy as basically every signal out there is flashing red and essentially we haven't seen this kind of stuff since 2007 which would be the great financial crisis era. Uh let me show you the headlines and it says US treasuries are now firmly in the quote danger zone. That's what we're talking about strategist say. Okay, so what do we US treasury enter danger zone as surging long yields raise fears that sticky inflation. Okay, Taiwan inflation that's not going away and a hawkish Fed.

[00:00:30]So Fed could possibly raise rates this year could begin spilling over into equities and broader risk assets. It's coming from HSBC. So they're worried that everything is going to start selling off basically. And the big warning is when you see the stuff in bond markets that's supposed to be right should be stable. Uh but apparently it feels like that there's everything selling off. There's no buyers and there's lack of confidence in either Trump, the US government or or the Fed.

[00:00:58]Any any take your pick, right? Which one you which is, you know, least one you have confidence in. Um but I I'm just showing you guys what it's going on.

[00:01:05]This is then from Bloomberg today. Then US 30-year yield hits highest since 2007 as selloff deepens. And again, um we're just concerned about the whole system right now. And the big problem is what you're going to see as we go through this is that it's not just one thing, it's everything. And that's why every one is like, "Oh my god, this is awful."

[00:01:24]Okay. Yields on the US Treasury longdated bond rose to the highest level in almost two decades. So again, since 2007 as investor concerns mount that the accelerating inflation now it's inflation is getting not only going in the wrong direction, it's getting worse, right? Will force central bankers to raise interest rates possibly this possibly this year, which is kind of crazy. Um everything all the predictions were like, "Okay, maybe next year we'll we'll talk about a raise. hold pat all year this year, but now we're talking about raising this year perhaps. Uh the 30-year yield rose as much as seven basis points to 5.2%. Now that's Tuesday. We're going to see how this thing continues. And this is the last time we've seen this since uh 2007.

[00:02:06]Here's a quote. The bond market is pricing in higher for longer rate policy. Okay, so no cuts anytime soon, possibly raise most visible and the long end of the curve where duration sensitivity is the greatest. Okay. Then it says here ongoing uncertainty around Fed policy, energydriven cost pressures and heavier Treasury issuance. So is the Fed going to raise right uncertainty there. Uh is the energy situation say in Iran is that going to um increase costs across the board? Is there going to be supply problem with oil? Right? We taught this several times on the channel. Heav heavier Treasury issuance.

[00:02:44]So is Trump going to continue deficit spending? uh are we going to spend a whole bunch of money on the war and essentially is is US gonna you know I don't know you can say you know operate on borrowed dime like like like this whole system is based on debt and then and then is that is that our plan uh to you know I guess I'm kind of in top gun mood right now try to write checks that our body can't cash that that that was that was literally my my first reaction to this one um this is the the chart here of the of the 30-year and so basically what they're they're saying here is uh the 5% level. Yeah, it is kind of 2007208. I can see in the chart and I'm showing you guys as well and haven't seen this for such a long time. Okay. So then it says persistently higher yields threaten to slow the US economy. So if borrowing costs maintain this, you know, higher levels, it makes it difficult for people to buy homes, to buy cars, for businesses to plan for the future. Um because it's just it's just what it is. Our modern system is all based on on debt. I borrow a bunch of money now hoping everything's going to grow later and assuming that everyone has jobs and everything's going to work out in the end, I guess, right? And and people, you know, make long decisions on on this kind of stuff on on stability, basically what boils down to. And everything that that Trump is doing is is destabilizing the system. Plus, the system itself again is based on debt and sort of long-term projections of stability, but you're not seeing that anywhere. Um, and the problem is it's on everything, not just one thing. It's it's everything. So this is where we're we're really worried. It says worrying for bond holders. Tuesday's selloff was not driven by a surge in oil price which crept lower, right? So actually oil prices went down a little bit. Uh it wasn't like a huge amount. But the the point we the point is like when we're seeing these, you know, sell off in the bond market like okay, it's definitely oil, right? It's definitely just oil because I saw the oil spike, but when oil is going down and you're seeing a bond sell off, that means wait, it's not exactly just the oil part. It's the whole system. And here's what it says.

[00:04:38]So that speaks to a broader nervousness in the market as investors reappraise the clearing price for debt. Right? So again, borrow costs are going up. Uh the 10-year then rose 10 basis points to 4.69, highest since early 2025 before the move pair to 4.66. Okay, so what else we got here? Um the market has swung to clear a hiking bias. So we think the rates are going to go up from the Fed. That's because investors are quote worried about energy prices pressure morphing into something more than a short-lived inflationary episode, right? Because Trump always says this is going to, you know, drop like a rock. I think that's that's his phrasing and and everything could be fantastic. But now we're looking at 80% chance of a 25 basis point hike by the end of the year.

[00:05:28]And this is the first time that I've seen it spike this high. So, if you guys have been following this stuff at all, you would know that Trump is all about I want to, you know, cut rates, cut rates, get them effectively to zero, get everyone borrowing again and go to the moon. But from all the things that we're looking at right now, the markets are actually pricing in again a rate rise, a hike, and it looks like that there's people are selling off and um there's very few buyers. So, you got a combination. Uh, you also have then Trump and his people, his family basically trying to make it so that we can never investigate them ever again, right? Donald Trump and sons granted forever, well, quote, forever immunity from existing tax audits. This feels like the essentially burning down the house and they're trying to, you know, I guess grab all the cash they can before the house burns down is better way to describe it and then not want people to investigate them that they burned down the house. Okay. And it goes more than just Trump and his family. Actually, we're talking about the SEC now. Now, this just came out. Um, I knew they were doing stuff similar to this, but I didn't know it to this extent. And we're talking about IPOs. And why why are we talking about IPOs? Well, think about this. Some of the bigger name company or want to go IPO this year. So, that would be U Anthropic, OpenAI, that's the AI stuff. And then Elon Musk, SpaceX/XAI company. And effectively what it is is deregulate as much as you can, less transparency, and make it so these companies can do a quick cra cash grab the same way that the Trumps want to do.

[00:07:03]Um, and do it as quickly as possible before the end of the year. That's basically what it is. And and you could argue maybe all these people want to do these things before Trump's, you know, uh, UFC fight, which I mentioned in the last video, or before SpaceX's IPO. I think that's I think June, next month may end up being go down in history.

[00:07:20]like that was definitely peak madness and everything melted down from there and then maybe it gets called out the the first time the Fed hikes. I'm just projecting in the future like the big events that you're going to be looking at. So this is what it says. The SEC announces new rules to make IPOs great again. Okay, so what are we talking about and just we'll look at it together here. So the Securities Exchange Commission, so the SEC on Tuesday proposed two new rules. Okay, the agency will make it easier for companies to go public. Right? So remember Elon Mus wants to go public right now. Now they're going to try to the Trump people are going to try to say no this is all about helping small companies but it's just it's not really the case. I mean well even in that regard you can make it easier for companies to you know go IPO but this is honestly helping more Elon Musk right or you can say it helps all of them but but it's the small company explanation is to cover for Elon Musk scam basically. Um it's the largest overhaul of the IPO rule in 20 years. So we got our bond markets looking like 2007 and our IPO trying to roll it back to that era. It's it's crazy how everything kind of lines up to like, hey guys, let's do a financial meltdown again. Basically, okay, so make IPOs great again. They say bigger picture, fewer companies go public than they did in the '9s. Okay, so so that means we want to go back to a bubble era where everyone and their their mom and you know, dad can go public and uncles and aunts and everyone can go public. You see what we're saying here? cuz cuz basically the the leadup to the.com bubble crash was then okay um let's have everything loose and and free right um and then we're like okay let's not do that again let's not have another meltdown but then we're trying to roll things back deregulate okay follow the money the reason for um the reason for decline for starters there's now more private capital bill for venture investors okay so that would be saying that people don't necessarily have to go to public market anymore and now you can do it all privately so that would be one reason why we don't have so many IPOs and then also too you have the um rule changes because it says many companies would do it but this is to be hassle to file all of the public filing requirements and more regulations. So then they would go to private markets.

[00:09:18]Um the rule changes proposed Tuesday are fairly wonky but in broad strokes they would here it is make it easier for small companies to conduct shelf offerings. So basically um easier to just issue shares and to sell. And this actually it matters because then for example an Elon Musk company goes IPO they can have like a bunch of okay we're gonna create a bunch of new shares and we can dump them off whenever we want.

[00:09:41]So that means they go IPO let's say that the share price you know spikes 100% or whatever then they can quickly issue shares the next day as quickly as as possible. It's it's cash grab the best way to describe it. Um this would be the most significant modernization of the registered offering framework in more than 20 years. Okay. relax disclosure requirements for smaller companies and give larger firms at least five year on the ramp before having to adhere to stricter disclosure rules. Those two things right there that that's that tells you all you need to know in making it easier for Elon Musk and his you know buddies to to sell off as quickly as possible issue new shares as quickly as possible. Dilute you as quickly as possible and then also I guess the first five years after you go public there's less disclosure and then it specifically mentions Elon Musk here. Uh the change could be a boon for Elama SpaceX which is expected to begin trading as a newly public company as as soon as next month as well as mega IPOs right anthropic and open AI and then basically again they want to well they say make IPOs great again but they they want to just deregulate everything and it's all a big you know cash grab of basically run running with the money um before the house burns down. That's the easiest way to describe it. And um it's it's ugly out there. I I know a lot of people um you know just want to focus on what color Trump's hands are or you know what stupid crap that he's saying. But do not ignore the money and do not ignore the market. So that's my thoughts on this.

[00:11:08]Um, please uh share and I'll catch you on the next