Another ‘Under the Radar’ Default

Not too many people know or care about Sri Lanka, but their recent Under the radar default is a great reason to be concerned.

Why?

It’s the first of many to come.

And especially in Asian/Emerging markets.

The culprit for the under the radar default?

An economic and political crisis triggered by…Wait for it… global shock waves from the pandemic and the war in Ukraine.

Sri Lanka’s inflation has hit 40%,

And the shortages of food, fuel, and medicines combined with the rolling power blackouts, have led to nationwide civil unrest.

Their currency has been collapsing and in the face of rising US dollars*, they are unable to pay their debt.

(*Read: Why Emerging Stocks Will Falter HERE)

A Not So Under the Radar Default

This marks the first time in Sri Lanka’s history that they’ve defaulted on their debt.

Ironically (or NOT) it’s also the first default by an Asia-Pacific nation in this century.

And you don’t need to be a rocket scientist to realize that the rise in the dollar and the rise in US interest rates would set off an economic crisis in the Emerging Markets.

Sad to say, this is just the beginning.

And it’s also adding gasoline to the fire of how CIVIL UNREST is the precursor to international war.

Meanwhile, we remind our “…In Plain English” subscribers how we warned in February, that if you own any international mutual funds ESPECIALLY EMERGING MARKET FUNDS, you need to get out of them.

Period.

We hope you took our advice.

But if you didn’t, it’s still not too late to act.

One Default Leads to Another

Sri Lanka’s default should serve notice to the rest of the world – especially Asian markets – how vulnerable they are to any rise in the US Dollar. *

(* Read: Why the Dollar Won’t Crash and Burn, Yet HERE)

Think of this as one more piece of the global puzzle adding to the eventual Sovereign Debt Crisis felt by everyone.

It’s already baked into the cake.

And in the process, we have the CoronaHoax to thank for accelerating the loss of confidence in government…which eventually brings chaos into the markets.

(Second reminder to self…buy more gold and store it OUTSIDE the banking system)

A rising US Dollar will destroy everything in its path.

Hedge accordingly and protect your investments by reading the May issue of “…In Plain English” (HERE).

Share this with a friend…even if they don’t know where Sri Lanka is.

They’ll thank YOU later.

At Financial$Matter We’re Not Just About Finance.

We Simply use finance to give you hope.

https://www.financialsmatter.com/category/in-plain-english/

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