Global debt is over $250 Trillion

Global debt is over $250 Trillion

Central banks had thrown money at the market since 2000 and being at it for over twenty years. This time, however, Central Banks are running out of powder, and the debt bubble they helped to create is astronomical, over $250 Trillion. ECB, BOJ, and many other major economies have already fired their last shot with no effect.  Total U.S. debt has reached a new all-time high of more than $70 trillion, which is over 101% of GDP. The U.S. treasury is throwing $60 Billion per month to buy Treasury bills, but saying this is just a technical issue.

So far, investors have decided to ignore all the bad news just like all financial bubbles in history, ignored until the very last moment.

Tech Bubble

2019 “App” boom and flourish of IPOs with no profit prospect is shaping up to resemble the 2000 tech bubble crash. 

 Apps fall into two categories, those that use content to attract users in anticipation that these users can be monetized like LinkedIn, Twitter, Snapchat, Facebook, and those a service or goods, such as Uber, Lyft, Deliveroo.

In the case of goods and services App, investor funds are used to subsidize prices to both suppliers and customers. This is the equivalent of paying suppliers more than the market rate and then selling to customers at less than the market rate.

For example, Ride-hailing apps Uber and Lyft, respectively valued by investment banks at US$120 billion and US$15 billion, are full of promises but yet to make any profit. Uber’s losses for Q2 2019 were $5.2 billion losses, $4 billion in 2018, and $4.5 billion loss in 2017.