One dollar of debt buys less than one dollar of GDP. How depressing is that, well now we find due to monitizing and sterilizing, the big 3 central banks account for over 25% of the developed worlds GDP, i.e, over $8 trillion dollars.

What does this mean? It means that nearly $8 trillion in world economic growth is artificial and exists only courtesy of central bank intervention – if one is looking for the reason why there is no mean reversion to a more stable period of time, there’s your answer. It also means that central banks will never unwind their “assets”, either actively, or passively, by letting them mature, as doing so would effectively mean an accelerated return to a non pro forma status quo, one in which global GDP suddenly finds itself $8 trillion less. It also means that in this age of ongoing consumer and corporate deleveraging, central banks will have no choice but to continue monetizing not to generate incremental growth, but to offset debt destruction elsewhere.

So in a fake global economy

up to 25% of all economic growth is what in a different day and age would have been called “one-time and non-recurring” – unfortunately, since now this is the trump card on which the entire western model depends, “one-time and non-recurring” is better known as “constant and endless.”

Source: ZeroHedge

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