I'm going to give this a college try.
He starts out with technical analysis saying that the dollar is bullish when looking back, from the early 80s, or the 2000s depending on which chart you look at. He points out a 15 year top in Asian currencies. Emerging market forex has been falling against the USD for ten years. Fed has been printing but velocity remains low over the same time frame of ten years. Huge swathes of currencies have fallen against the USD in the past year despite easing.
"slowing growth causes the dollar to rise, which causes slower growth, which causes the dollar to rise, as all borrowers play musical chairs to get access to the dollar to service debts"
"swap lines cant help the weakest sovereign borrowers as they have no reserves."
"The global system is just not set up to deal with this. It is an UGLY situation with almost zero options without a change in the entire system. No printing of money will solve this. It is structural."He is bullish on gold and says bitcoin will play a role but hasn't made any moves relative to this problem yet.
This is an observation of the debt deflation cycle and he says bonds will create the next signal when yields go negative.
"that will be the signal to sell equities and the INSOLVENCY phase will begin."
I read it. I'm not a chart person, and I think a lot of others aren't, so please explain what we're seeing. I do get that relatively speaking, the US dollar appears to be increasing against other world currencies. Which to me seems like a fair time to buy other currencies or other currency denominated assets to hedge exposure to the dollar.
I think what he is saying is that you can't really hedge against the USD since other world currencies are behaving like they are relatively fixed against the USD. And that this situation can't be resolved by other countries since they don't have reserves or growth, and the US can't resolve it since the US is struggling with growth and cannot maintain a perpetual $ deficit to keep up with demand for USD.
So the fed is printing a lot of money, which we know. But because the velocity of money has dropped so much, even with more dollars circulating, we're seeing signs of deflation, not inflation. And the dollar is appreciating against other currencies in the world. A lot of the charts seem to be arguments for further increases in the dollar's value relative to other currencies.
Raoul argues that this shows that the Fed printing money both directly and via dollar swap lines with other countries around the world is doing nothing. It's not clear to me how he's distinguishing "doing nothing" from "reducing the deflation/dollar appreciation that would otherwise be caused by a slowing velocity of money, but not all the way." Did someone else catch the reasoning there?
He also argues for further appreciation of bitcoin/gold type assets going forward.
The thread starts with a rebuttal of the idea that fed easing in the US will be inflationary, then points out the deflationary landscape at play more globally and more historically, then says we don't really have a path out of this. He's arguing we are already in a debt deflation trap and the USD continuing as a reserve isn't going to resolve it.
Edit: I believe he's also expecting an equities market sell-off due to this as well. Peter Schiff commented further down the thread, you can read the twitter thread here:
https://twitter.com/RaoulGMI/status/1254110879479746562Schiff: "The primary reason the dollar didn't collapse because of past ZIRP and QE is that the Fed fooled markets into believing that the policies were temporary and that it had an exit strategy. The realization that both are permanent and exit is impossible should seal the dollar's fate."