➡ The article discusses how during a recession, tax receipts drop significantly due to decreased income and business profits. It also highlights the global increase in liquidity, with money moving around the world at record speeds. The article suggests that the possibility of a recession is largely a policy decision, with governments injecting large sums of money into the system to prevent economic downturns. It concludes by emphasizing the importance of understanding liquidity cycles in the current economic climate.

➡ The economy is in a paradox where bad news for the economy is good for asset prices, and vice versa. The Federal Reserve is planning to cut interest rates, which will stimulate the market. Despite consumers feeling uncertain about the economy, businesses are optimistic. In this situation, it’s best to invest in assets with a fixed supply, like gold, silver, land, fine art, and cryptocurrencies, especially Bitcoin, as it’s the only asset with a fixed supply and is sensitive to global liquidity.

The entire financial system is being rebuilt right in front of our eyes and 99% of people have no idea it’s even happening. Now while the U.S. government hemorrhages $1 trillion in debt every 100 days, literally it’s melting your savings like an ice cube in the sun, there’s a small group of companies that just discovered something that changes everything. They’re creating infinite capital using new technology and integrating it into the old traditional financial system and the same institutions that said this would never work are now scrambling to get in. I know because I’m a partner at a leading venture fund.

I’m investing directly into these companies right now. I’m an officer of a publicly traded company using this exact strategy and what I’m seeing behind closed doors will surprise you. So in this video I want to break down everything you need to know about how money is becoming obsolete and why the next 18 months will determine whether you’re on the winning or the losing side of the greatest wealth transfer in human history. So let’s go. All right we’re going to jump right in and we are going to talk about the trap that we are in.

Of course I talked about how we can’t afford a recession and I know the first thing that comes to your mind is probably but but but Mark don’t you know about the economy? Don’t you see the credit card debt and don’t you see the delinquency is going and don’t you yes don’t you understand the economy? Don’t you understand yes unemployment tariffs. Yes I get it. Talk about all the time. But what if what if there’s bad news is good news. What if there’s a cycle that we’re in right now where the cycles are gone.

What am I talking about. Well let’s take a look at some charts here. I’m going to be using some data from Michael Howell. I think he’s the goat when it comes to global liquidity. I reference his work all the time. Capital wars. You might want to check him out. Of course I’m going to bring in a bunch of other stuff so I can show you what we’re talking about here. But what we’re looking at right here is the world business cycle going from 1998 all the way to 2025. And of course you can see it’s volatile right.

We go through these cycles with these periods. Now what he’s done here is pretty ingenious. He’s got the black lines which is like an AI projected model that he has. The orange line is the actual world business cycle and the dotted line is the JPM and the S&P world PMI. All right. So this is the business cycles that we’re looking at. And the part that I want to draw our attention to is we had this covid crash here. We had the sugar rush stimulus where tens of trillions of dollars were pumped into the system which shot that way higher.

And since then we basically had almost no volatility. The cycles have been gone for over five years now. Now typically we see this happening quite often. We’ve now gone from this cycles of business going up and down to an RORO which is basically risk on or risk off right. You hear about risk on assets risk off assets. So that’s what we’re talking about. And we’re in these cycles where we either risk on risk off. Now in the textbook when you’re a Warren Buffett you’re a Benjamin Graham disciple. The textbook tells you that stocks are backed by earnings which is why back to the economy.

Most people keep thinking about the economy but but but the economy right. If they’re backed by earnings and the economy crashes and the companies don’t have as good of earnings then the stock market has to crash right. Well what I would say is just go back to 2020 and just look at when the entire global economy businesses literally got shut down asset prices made new all-time highs. And so in this RORO cycle that we’re in now assets asset markets are dominated by not the underlying economy not the earnings but they’re dominated by the global liquidity.

All right let’s take a look at the setup behind the scenes that kind of explain what Michael Hall is talking about here. So we have this thirty seven trillion dollar dilemma thirty seven trillion dollar prison. The United States government is in thirty seven trillion dollars of debt. Now this is not just the United States in this predicament. China Japan the ECB everyone’s in the same problem. We’re all looking at incredible incredible amounts of debt. And so we have thirty seven trillions dollars of debt in the United States and I put a couple lines here so you could see this.

So what I want you to see here is looking at this debt chart we can see this red line which is this trend line and you can see how it was going up but we would end up right here but what you can see is it got steeper here and then we got onto a steeper trajectory here and then we got into a steeper trajectory here and now we got onto a steeper trajectory. How much steeper can we get? Can we get going straight vertical because that’s what’s coming next. You can see that now to kind of put this into some numbers so you can understand just how quick I should say how eye popping this is happening is we’re basically adding one trillion dollars to the national debt every hundred days.

Now what this shows right here is it shows how that’s changed over time. So in the two thousands we were adding a trillion dollars of debt every seven hundred days on average every couple of years. In the 2010s we went to one trillion dollars of debt every 331 days so about every one year and now in the 2020s we got to a trillion dollars every 150 days and now we’re down to a trillion dollars every hundred days. You start to see the difference in the time frames and how fast this is going up.

Now why does that matter? Well it matters for a lot of reasons. One of which is that the debt has to be paid. You got to make the payments on the debt so there’s a problem obviously as the debt gets higher the payments go up but we also have the interest rate that we have to pay on the debt. So those are two things. Can we bring the debt down or can we bring the interest rates down? Now you know why Donald Trump is pounding on Jerome Powell at the Fed to lower rates.

We got to make this cheaper because we can’t afford it. As a matter of fact what this shows is the payments on the debt and you can see of course as the debt goes up the payments go up and right now here we are in 2025 the payments are over 1.1 trillion dollars per year just on the payments of this. All right now there’s a couple things that I want to draw your attention to that matter. First of all the CBO the Congressional Budget Office the ones that set the budget the forecast for the government they project out for the next 30 years what we would expect debt to be deficit spending to be debt to GDP all of these things and

what they said is that looking at the long-term budget this was released in March of 2025 looking at the long-term budget outlook it says the federal budget is on a quote unquote unsustainable path unsustainable path meaning it can’t go on why a couple things one they’re projecting that debt will surge past record levels so there’s no end in sight this is only going to surge to levels we haven’t seen before number two deficits will rise even higher so the amount of money the difference in the spending versus income coming in is going to continue to get wider the revenue is not going to go up as fast as the spending will go up three spending will continue to outpace revenue which of course is why the deficits go up interest costs will explode of course they’re going to explode because as the debt goes up there’s more interest and with rates being high it makes it even worse and then social security sorry to break it to you is is only eight

years away from insolvency meaning if you’re counting on social security for your retirement it’s probably not going to work out too well for you so this is the rate that we’re on this is the government’s own office breaking that down for you and i want to show you one more thing this is why we can’t afford a recession well one of many reasons this is showing you the amount of tax receipts that the government brings in so the problem is that the debt keeps growing the problem is that we keep spending more than we’re bringing in the problem is that that is going to continue to widen but what happens if the amount we’re bringing in

actually collapses how much worse does it make the unsustainable path that we’re on well let’s take a look so what we can see these gray bars are recession lines and you can see in a time of recession the tax receipts plunge of course if you don’t make as much money you don’t pay as much taxes if your business doesn’t make as much money you don’t pay as much taxes if your investments don’t go up you don’t pay capital gains taxes we can see the next recession interest or tax receipts plunged this one it happens so quickly it plunged but it happened so quickly so what happens in another recession well typically we could

see tax receipts plunge 15 to 20 percent we’re talking trillions of dollars more in a time that we can’t afford that okay let’s go back behind the scenes a little bit so you can kind of see what’s already happening that they’re not really telling you so while you’re waiting while most people have been waiting for the the recession to happen the tightening is happening don’t you know that the fed is not loosening rates you know trump is trying to get him too but he’s not doing that well behind the scenes it’s not tightening behind the scenes it’s actually exploding higher so this is again another chart we’re looking at from michael howe and this is global liquidity this is not the united states it’s global why does this matter see most people are looking at us debt or us m2 things like that we want to look at it globally the reason why is because money moves globally especially when we’re talking about commodities we’re talking about gold we’re talking

about bitcoin we’re talking about uranium we’re talking about wheat we’re talking about oil so these are global commodities and also money moves around the world so when china unleashes the money printers a lot of that money comes and buys us real estate us stocks us businesses etc and what we can see is this is a weekly global liquidity chart and so this is where it bottom in 2022 if you’ve been watching my channel for any period of time you know that i’ve referenced this date because i started making videos here here here here telling you there was no market crash coming and the reason why is because global liquidity was taking off and we can see that we’re still making new all-time highs so while certainly trump wants pal to lower rates to get the liquidity going in the united states it’s going at record speeds right now globally all right the daily market liquidity index is also at an all-time high and they can’t stop flooding the system

here’s another chart this is from my friend nick body over at the bitcoin layer and again you can see the same thing back to October 2022 and look at these levels that we have there’s more money sloshing around the system at a faster and faster pace than we’ve ever seen they can’t stop flooding the system why because they can’t stop spending money and we can’t afford a recession and when i say they can’t afford a recession let me let me let me explain that to you a little bit better you see let’s think about this for a minute when the government is spending two trillion dollars more per year than they’re bringing in when

they’re pumping money in the system to keep it up then the only way we let the system fall is if they stop spending more money and they stop pumping it up so then it would almost seem like any chance of us having a recession is by policy decision like they’re going to get together they you know the government trump the trump administration the federal reserve etc they’re going to get together and say ah we’ve had a good run boys pack it up let the system crash you see it’s a policy decision right now to continue to inject two trillion dollars in the system and why would they decide to remove the punch bowl what policy choice

who’s going to make that policy choice okay let’s look a little bit deeper let’s see the secret pattern that most people are completely missing so we have different types of data we have soft data and that’s sentiment so there’s lots of polls that go on and we gauge how businesses feel about the economy and how consumers feel about the economy then we have hard data then we have the economic indicators we have the employment data right we have spending patterns things like that and what we want to do is we want to look at the difference of the hard data and the soft data so we want to look at the business sentiment

and we want to see how that’s going to affect things you see when the business sentiment when the business cycle is lagging when it’s stuck in sort of like a holding pattern what’s going to happen well the government wants to increase that they want to stimulate that and so they try to do things like making money cheaper by putting more money in and it gets the central banks to ease to get that sentiment to get the consumer spending back up now this chart right here sort of predicts it as a matter of fact it’s been predicting it for over 30 years now what michael howell has done he’s a genius here is he’s offset the hard and soft

data by six months so we have in the black line the world central bank liquidity and then the orange line is the hard minus the soft data and again that’s set back by six months because there’s a lag it’s not like they turn the spigot on and everything starts taking off and you can see how closely this all comes together now again there’s a six month lag so what do you think is probably going to happen for the next six months well it’s going to continue following the liquidity and the market cycle will continue going up this predicted every single boom bus for the next 30 years okay and there’s another thing this is what’s underneath all of the surface you’ve heard me talk about this quite often it’s the volatility trap and one thing we want to look at is the government needs to spend more money they take in in order to do that they have to get more debt in order to get more debt they have to sell the treasuries that’s what scott is to sell the treasuries the

problem is is he can’t have the volatility move up too high or people don’t want to buy the treasuries and so we want to keep an eye on the move index the move index charts the volatility in that in the bond market and we can see right now that we are sitting at a two-year low of this market again going back to 2022 when they started injecting lots more liquidity in the system so what happened here well we injected a bunch of liquidity what do you think happens right here even more liquidity we have to get that down we’re setting up perfectly for that liquidity to come in another thing that we can see perfectly for the liquidity to start

coming back into the system is the rrp the reverse repo window now we see that this started cranking up when 2021 right before 2022 when the fed had to start injecting that money to keep the banking system from collapsing overnight so we can see that dwindle from two and a half trillion down to 57 billion today now where does that go well that money channels back into money market accounts it goes back into banks it goes back into assets that can pay more money this is liquidity going right back into the system and we can see here more policy choices that are being made the us treasury keeps notes bonds auction sizes

steady and it’s increasing its debt buyback so if not enough people want to buy the buy the debt well i guess we’ll just buy it on our own again increasing liquidity into the system and then again more policy choices right here we can see that they the fed wants to change the slr rules to allow big us banks to hold more treasuries so again we need more people to buy them let’s keep the liquidity low we’ll buy them back if we have to as a matter of fact why don’t we just go change the rules that allows banks to buy even more and enhance supplementary leverage ratio that’s the slr and this is just done this is august 26th of 2025 this is

when this comments have to be done by they’re trying to get this through all right now why more liquidity it’s all coming and it’s all because we can’t afford a recession now this is the new game again if you’re warm buffett menjimogram disciple i get it you’re still looking at the economy waiting for the economy to bring the markets down but this is a new game forget the business cycle instead think in terms of liquidity think in terms of risk on and risk off think in terms of liquidity is rising or liquidity is dropping that’s how we have to think about it only the liquidity cycle seems to matter right now and we’re really in this situation in this

paradox i’ve been talking about good news and bad news good news is bad news and bad news is good news what does that mean well things are good and bad at the same time what this means is that if the economy does bad then the government and the fed has to stimulate markets which is good for asset prices bad news in the economy more unemployment right bad news in the economy means good news for assets good news in the economy means bad news for assets you’re starting to understand that now when this is happening when we’re in this phase when we’re in this ror we have to understand there’s a different playbook that’s required all right a couple things i want to show you here the federal reserve is expecting three interest rate cuts this year again more liquidity right we can see this is coming from every angle we can also see the sentiment index which i think is pretty interesting right here what we can see the blue is

the business index sentiment index and the red is the consumer index and it’s interesting to see the divergence right here so while consumers are feeling constrained they’re thinking oh man the economy’s pretty bad i don’t know if i want to spend money the business cycle’s thinking that things are pretty good right the employment is high right the pmi is high and so we have this divergence here and this is what the fed is trying to stimulate they want to get more out there so when we’re in this what’s the playbook we have to understand that we want to go into things with an inelastic supply those are the assets that are going to win we’re talking about gold we’re talking about silver we’re talking about land we’re talking about fine art we’re talking about bitcoin cryptocurrencies and things like that all right why bitcoin of course if you watch my channel you know i talk about it all the time and it’s because it’s the only asset with a fixed supply now

if we look at some other assets i actually have this one up if we compare this against some of these other assets with finite supplies we have bitcoin with a zero percent zero fixed increase in supply there’s never going to be more than 21 million absolute scarcity yes versus real estate obviously we can still build more real estate gold we get more gold out of the ground about one to two percent of the gold supply increases per year but more importantly than that in this cycle that we’re in all eyes on global liquidity we can see that bitcoin maps almost perfectly with global liquidity look at this movement that we have right here so in

the green we have the global m2 liquidity in the blue we have the bitcoin price and again they’re following perfectly with a lag and so when we have global liquidity shoot up where do you think bitcoin goes next and so we want to go with assets that are the most sensitive to global liquidity when we’re in this type of a cycle all right so what are we gonna do with all this now that you understand the picture understand now that you understand that the government’s policy choice is to spend two trillion dollars more per year their choice is to stimulate the economy to keep things going when you understand that the money is coming

they’ve already changed they’re changing the policies on banks buying treasuries and the money sitting in the rp all these things are being done and so while everyone’s waiting for a recession holding cash knowing our cash is being diluted by 10 percent a year we want to position ourselves in inelastic assets and the last thing is we want to understand that there are new rules to the game if you’re still reading Benjamin Graham’s books on investing you’re probably not understanding that we are playing a new game in this new game it’s risk on or risk off and this new game is liquidity is easy or liquidity is tightening if you understand

the rules of that game you’re going to have much better success and if you want to understand what’s about to happen in this new game you might want to watch this video about Trump’s new executive order right here and I’ll see you over there
[tr:trw].

See more of Mark Moss on their Public Channel and the MPN Mark Moss channel.