What happens when the banks literally own everything?

No, I'm not asking this as a theoretical exercise. Nor am I being excessively pessimistic.

I'm speaking of a scenario that will happen if current trends continues.

The chart above shows how just three central banks printed money out of thin air to buy nearly $14 Trillion in financial assets.

Globally, central banks own roughly $18 Trillion in bonds - over 1/3rd of all the bonds on the planet.

When you include private banks, banks own half of the global bond market.

Leading the charge is the Bank of Japan.



The bank's total assets stood at 498.15 trillion yen as of May 20. By the time the month ended Wednesday, its holdings of Japanese government bonds had increased by another 2.24 trillion yen. Assuming that the BOJ had not significantly reduced its non-JGB assets, its balance sheet almost certainly crossed over the 500 trillion yen mark into uncharted territory.

At around 93%, the scale of the Japanese central bank's assets in proportion to GDP has no close match.

Central banks have always been market movers, but now they own the markets.

Don't think for a second that all this money printing/asset buying is limited to just bonds.



The Bank of Japan has stepped up purchases of exchange-traded funds as part of its monetary easing policy, with the balance surging to 15.93 trillion yen ($144 billion) as of March 31.

Don't think for a second that all this money printing/asset buying doesn't slosh over borders.



According to its last filing with the Securities and Exchange Commission, the Swiss National Bank owned more than $63 billion worth of stock — most of it in US companies...

The latest filing included more than 15 million shares of Apple, 13 million Intel, 25 million General Electric, 6.6 million Facebook, 10 million Ford, 13 million Intel and on and on and…

In fact, a printed list of all the stocks is 66 pages long.

There is no telling how much stocks central banks own.

For years now central banks have been warning that they would start selling their portfolio. Not only does that day keep getting pushed back, but when you own everything who are you going to sell too?

It doesn't take a genius to know that the group that owns everything will call the shots.

It also doesn't take a genius to know that when the next financial crisis hits, the politicians will obediently bail out the bankers again, even if it means they will leave nothing left for the 99% but debt and poverty.

The next financial crisis will mark a global crisis for democracy, and won't be settled without violence.