The major credit event is unfolding as we speak. Markets have not accepted the new reality of 5% interest rates yet. But it is a very serious situation.

The intent of raising rates to fight inflation is to cause this credit event. They want to cause unemployment af, so that demand and consumption drops. Its a terrible strategy if you ask me, but its the only one they have, if the fed is the only tool they are going to use to combat inflation and it looks like they are. (They can shrink government spending, decrease taxes, motivate productivity with some real leadership+more BUT THEY ARENT)

And i think the US gov will default on its debt this year. I tried to figure out what will happen in such an event, and other than pissing a lot of people off basically the US government will have to shrink spending about 30% or more. Considering that US government spending is such a big portion of GDP it will cause significant unemployment. My concern is that the US government then gets a clean slate and the economic conditions to implement all kinds of welfare and otherwise terrible policies to try and fight this unemployment. But all thats going to do to is cause a new great depression imo. which is bad for most asset prices (They may be deprssed but they may also be in serious shortage at the same time). But lets see.