Kyle Bass and The Last Domino

If there were a domino chain from China around the world, probably the last domino would be the United States. America would be the SNAP! at the end of a whip, as it were–the point at which energy is finally expelled from a system. But the reality is, such energy is never really expelled from the world’s economic system; it’s merely appropriated elsewhere.

These things get especially disturbing when one considers Kyle Bass’ words on a recent episode of the show Half Time. On that episode, China’s looming economic decline was discussed. Some felt that the trends they were seeing start were beginning because it was the natural end of a profitable cycle. Kyle Bass thinks symptoms stretch much deeper. According to Bass, China’s banks have been lending in substantial excess to the nation’s yearly Gross Domestic Product. China’s GDP is $10 trillion, the banks have the country in the hole for $35 trillion, and surrounding countries are poised to collapse like the aforementioned dominoes.

The end result of this, according to Kyle Bass, will be an economic decline in the United States between ten and twenty percent, meaning the bears will dominate Wall Street during 2016. As a result, savvy financiers across the globe are slowly withdrawing support from China, which certainly won’t defray their economic bubble’s looming implosion.

While Kyle Bass may not be the absolute authority on these matters, he is an authority, and for good reason. Bass came on the financial scene with a bang in 2008 when his successful prediction of the sub-prime lending crisis made him almost instantaneously famous. Kyle Bass works as a hedge-fund manager in Texas, but is of Argentinian descent, and has close ties to the country’s socialist president, Cristina Fernandez de Kirchner. Bass has also been involved in some legal stock market manipulation through his organization “The Coalition for Affordable Drugs”. Abbreviated “CAD”, this organization has been successful in its mandate to diminish the cost of necessary medication from big-time pharmaceutical agencies, but the ending domino in that chain knocked said pharmaceuticals’ stock down several points, against which Bass short sold his own shares and made a pretty profit. So pretty was that profit, politicians across the political board have been prodded into pushing Bass out of the arena; but since his actions were entirely legal, as yet they’ve been unable to do so.

With all this in mind, it becomes obvious that Bass understands financial markets well enough to make himself rich; and that means his words about China shouldn’t be ignored. The question becomes what his angle is. Is that angle merely self-interest, or is there a socialist component lurking in subterfuge? It’s hard to tell, but regardless of the direction from which it comes, Bass stands to profit.  That’s a part of the suspicion around Kyle Bass, and why UsefulStooges has been interesting for raising so many questions.

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