The nature of money.(화폐의 본질)

 

In the macroeconomic landscape, the U.S. dollar serves as the settlement currency for all raw materials, and its value is fundamentally anchored to gold. In contrast, the currencies of all nations other than the United States derive their recognized value from a form of guarantee provided by the U.S. dollar.

Consequently, the trajectory of global price levels is determined solely by the decline in the value of the U.S. dollar. For an appropriate level of inflation to occur in tandem with an expansion in the money supply (M2), the value of the dollar must inevitably continue to decline, gradually and consistently.

This is the reason why, as shown in the chart of the U.S. Dollar Index, the lows at the bottom of the trend line continue to shift downward over time.

Dollar Index (100%) = Euro (57.6%) + Japan (13.6%) + UK (11.9%) + Canada (9.1%) + Sweden (4.2%) + Switzerland (3.6%)

Therefore, most nations that rely on the U.S. dollar to underpin the value of their own currencies share a common characteristic: regardless of how wealthy a nation or its citizens may be, they cannot exert any meaningful influence over interest rates. Instead, they are bound to adhere to the specific weightings defined by the composition of the Dollar Index.

Why, then, are countries such as Switzerland, China, Singapore, Japan, Sweden, Denmark, and Thailand—as shown in the chart—referred to as "liquidity-crisis nations"?

It is because they are required to maintain their currency value and interest rate environment within the limits of the U.S. dollar’s ​​guarantee—a constraint that exists independently of the actual capital wealth held by these nations. They are labeled "liquidity-crisis nations" precisely because they are failing to manage this balance effectively.

Ultimately, due to this fundamental nature of currency, one could say that just as the pitcher determines nearly everything in a baseball game, the Dollar Index determines nearly everything regarding the direction of the macroeconomy.

So, why the prediction that companies like Apple, Google, Nvidia, Samsung Electronics, and SK Hynix—along with other semiconductor-related firms—will face a decline, while sectors like crude oil, natural gas, and solar energy are set to grow?

It is because the dollar is weakening, and as a result, the entire world is entering a period of high inflation.

Why should we be concerned about the trajectory of the dollar?

According to the "rules" governing the dollar, the U.S. Dollar Index has the potential to fall as low as 60—a shift that could trigger levels of inflation unseen in the last 100 years.

(원문)

 거시경제상에서 모든원자재의 결제통화는 달러이며, 달러는 실제 금에 기반한 화폐가치를 가지고있습니다.

이와달리 미국을 제외한 나머지국가의 화폐는 일종의 달러 보증을 기반해서  가치를 인정받는 화폐이죠.

그래서  전세계 물가의 방향성은 오직 달러의 화폐가치하락으로 결정되기때문에 ,

통화공급량증가(M2)에 대해서  적정 인플레이션이 발생하려면 반드시   달러의 가치는  계속 점진적으로 낮아질수밖에 없습니다.

그림의 달러인덱스 규칙을 보면,  점진적으로 하단의저점이 낮아지는 이유가 바로 그것입니다.

Dollar Index (100%) = Euro (57.6%) + Japan (13.6%) + UK (11.9%) + Canada (9.1%) + Sweden (4.2%) + Switzerland (3.6%)

따라서,  달러의 보증으로 화폐가치를 유지하는 대부분의 국가는  한가지 특징이 있는데,국가와국민이 아무리 부자이고 부유해도  금리에 전형 영향력을 행사할수없으며, 오직     달러인덱스 의 규칙처럼, 각자 주어진 비율을 지켜야한다는것입니다.

그림에서  스위스,중국, 싱가폴, 일본,스웨덴,덴마크,태국 같은 국가들의 금리상황을  "유동성위기국가" 라 말하고 이유가 뭘까요?

바로 달러의 보증한도 내에서 화폐가치와 주어진 금리환경을 유지해야하기때문에, 개별국가의 부유한 자본과는 별개라는것이고, 이를 제대로 관리하지못하고있기때문에 유동성위기국가라 말할수있는것입니다.

결과적으로 이러한 화폐의 본질때문에,  

"야구는 투수가 거의 모든것을 결정하고  거시경제의 방향성은 달러인덱스가 거의 모든것을 결정하게된다는것입니다."

그래서, 현재  애플,구글, 엔비디아,삼성전자와 SK하이닉스등등의 반도체 관련  기업의 성장이 몰락할것이고, 원유및천연가스 그리고 태양광이 성장할것이다 라고 말한 이유가 무엇일까요? 

달러가 약해지고있고  그로인해  전세계가 고물가 영역으로 진입하고있기때문입니다.

우리가 왜 달러의 방향성에 두려움을 느껴야할까요? 

달러의 규착(룰)에따르면,  달러인덱스는  앞으로 60까지 열려있고, 

그로인해 인플레이션은  지난 100년 이래 한번도 겪어보지 못한  매우 높은 레벨의 인플레이션을 생산할수있기때문입니다.

2026-10-17 다음주 시황

 그림 왼족   미국 국채금리, 기준금리, 달러인덱스 그림오른쪽  각국의 국채금리,기준금리,긴축강도(국채>기준) 

​현재 거시경제상황은  

달러강세 박스권유지를 위해서 유로화약세를 만들기위한  프랑스의 긴축강도강화가 필요한시점인데 프랑스 긴축상황이 국민들의 대규모시위로 명분을 얻지 못하고있고  긴축강도가 또한 현재 정체되고 있다는것입니다.

이는 곧 달러의 정체를 의미하면서  미국의 긴축강도 역시 정체를 낳고있으며, 

설상가상으로  미국연준이 기준금리를 인상할경우  미국의 긴축강도는 폭이  좁아져 긴축의의미가 사라지게됩니다.

즉, 그림상에서  미국의 국채금리와 기준금리와의 폭을 보시면 이미 좁아지고있기때문에 

결국  달러강세 박스권의 흐름또한 약화되는  악순환을 반복중이라는것입니다.

그래서 달러인덱스 패턴상(1->2->3)  프랑스의 억지에 가까운  긴축이  포기될때

이는 곧  강력한 달러약세(100->90이하)를  추가적  만들수있는 가능성이 높다는것입니다.  

현재 달러 박스권의 붕괴및 약세화 가능성이 높다 보니까 

지난 달러강세의 저물가영역에서 호황을 누렸던   삼성전자와 SK하이닉스가  이에 대응해  주가폭락으로  반영하고있다는것입니다.

예전에 제가 분석으로  삼성전자의 시총은  다가올 대공황상황(총통화감소->2009년수준)에서   50조가 적당하다고했죠?

입에 거품을 물고  저의 분석에  반대하는 분들이 많았는데  삼성전자가  앞으로 달러약세 시기 주가가 어떻게 폭락하는지 여러분들은 눈으로 직접 목도하게  될것입니다. 

문제는  

거시경제상 삼성전자의 호황은   달러강세에따른 유가나 천연가스가격의 하락및 희생으로 만든 잉여유동성때문이란것입니다. 따라서, 유가가 앞으로 상승하면서 적정가치에 수렴할때마다  반도체의 호황은 계단식으로  붕괴된다는것이고 모든게 허상이란것을 깨달게 된다는것입니다.

또, 지난  17년이상  유가및 천연가스 하락과 더불어  누가 반도체호황의 잉여유동성을 만들기 위해 희생했습니까? 바로  원유와 천연가스의 대체제인  태양광 폴리실리콘가격의 처절한 희생또한 있어왔다는것입니다.

때문에 대부분의 비중국 폴리실리콘기업이 파산하고 

남은 비중국 폴리실리콘 글로벌기업은 OCI 홀딩스, WACKER, 헴록등  손에 꼽을정도라는것입니다.

즉,  초과된 성장을 한 반도체는 이제 더이상의 잉여유동성혜택을 받을수밖에 없기때문에 몰락하고 

삼성전자가  물러난 자리를 차지하는것은 OCI홀딩스,한화솔류션같은 태양광기업일수밖에 없다는것입니다.   

결과적으로  미국의 긴축강도 약화와 프랑스의 긴축강도정체흐름을 주시해야한다는것이고 어짜피 돌고 돌아  더이상의 긴축강도강화는 이들나라들의 심각한 사회분위기상 불가능하기때문에 본격적인 달러약화의 선택버튼을 누를 날만 남았다는것입니다.

또,그림의 폴리실리콘차트흐름을 보시면 아시겠지만  태양광기업의 주식 가격은 그냥 거져주는 꽁짜에 가까운 환경이란것을 인지하셔야하고 투자적으로 볼때   한번 발동이 걸려서  떠난 버스는  나중에 후회하면서 잡고싶고도 잡을수없다는것을 인지해야한다는것입니다.

말씀드리고 싶은것은 

제가 지난  10년동안 태양광 주주로있으면서 처절하고 지옥과같은  모든 고통을 다 대신 겪었으니까 (거지가 된이유....) 

이제 남아있는 고통은 그리많지않고  존재하지않는다 하겠습니다.....

​

Natural disasters (천재지변)

 

In the analysis of "financial capacity to pay interest," it has been suggested that if a country exhausts its room for interest rate adjustments—or faces excessive inflation—its capacity to meet interest payments could vanish even before interest rates reach zero, potentially triggering a crisis akin to the Great Depression of 1929.

Given the current state of monetary policy in the Eurozone, countries with limited room for interest rate adjustments—such as Switzerland, China, Thailand, Japan, Taiwan, Singapore, Denmark, and Sweden—are particularly vulnerable. As they face rising prices driven by surging oil and natural gas costs, these nations risk a crisis stemming from the exhaustion of their financial capacity to pay interest.

However, there is a saying: "If you can't have the best, make the best of what you have."

Even if a future crisis—characterized by the depletion or exhaustion of the financial capacity to pay interest—appears inevitable, there may still be a way to overcome, reverse, or at least delay such a crisis. That solution lies in "natural disasters."

From a macroeconomic perspective, natural disasters can lead to an increase in interest-rate-related liquidity. Furthermore, they drastically reduce the consumption of money within the total money supply, effectively creating a deflationary environment. To put it simply: if a region—accounting for 30% of a nation’s total GDP—were to suffer a collapse of its economy due to a natural disaster, the consumption of currency and the rate of liquidity circulation in that area would plummet. Depending on the severity of the damage, this could—either permanently or for a significant duration—stave off the exhaustion of a nation’s interest-rate-based policy options and its capacity to meet fiscal interest obligations.

Therefore, even if a future crisis in monetary policy—driven by the depletion of interest-rate levers—appears inevitable, such a disaster—while unfortunate for the affected region—could paradoxically provide the nation’s monetary policy environment with an opportunity to escape that crisis.

The issue, however, is that typical natural disasters—such as typhoons, earthquakes, tsunamis, floods, or droughts—exert a deflationary pressure on liquidity that is merely temporary, not permanent.

Yet, there exists a specific type of "natural disaster" that could bring about a permanent increase in liquidity: a rise in sea levels.Because the rise in sea levels is not a transient event but a permanent one, it functions—from the perspective of preventing the collapse of the macroeconomic monetary system and extending its lifespan—as an almost essential mechanism.

The important thing is whether humans possess the scientific and technological capabilities to control natural phenomena, and since this part determines whether extraterrestrial beings from advanced civilizations ahead of Earth's civilization participated—a matter of conspiracy theory—it falls into an unknown realm of knowledge that we do not know. Ultimately, even when there is little room left for interest rate adjustments within the realm of monetary policy—and even as the economy nears the threshold of a Great Depression—there is always a solution to be found, much like the old saying: "If you can't have the best, make the best of what you have."

원문

Financial capacity to pay interest.(재정적 이자지급능력) 의 분석에서, 금리여력고갈또는 과도한인플레이션으로 인해서 제로금리이전에 재정적 이자지급능력이 고갈으로  1929년 대공황과 같은 상황이 발생한다고했습니다.

현재 , 유로존 금리를  정상적인 통화정책환경으로 볼때 ,  스위스,중국,태국,일본,타이완,싱가폴,덴마크,스웨덴같은 금리여력이 낮은 국가들이 , 본격적인 유가상승과 천연가스의 가격상승으로 만들어지는 물가상승시기에 재정적 이자지급능력고갈로  먼저 위기가 올수밖에 없는상황에 놓여있다고했습니다.

하지만,

"이가 없으면 잇몸으로 산다." (한국속담)

속담에 이런 말이 있는데,  미래의 현실(재정적 이자지급능력소진및고갈)이  정해져있고 위기가 다가온다 하더라도, 

이를 극복하려 노력한다면  위기상황을 반전시키셔 지연시킬수있는 해법이 존재한다는것입니다.

그 해답이 바로  천재지변입니다.

천재지변은  거시경제상  금리적 유동성 증가 효과를 가지고있다는것이고,  총통화량의 화폐소비량을 극적으로 줄여서  디플레이션환경을 만든다는것입니다.

이해하기 쉽게 설명하면,  

한국가의 총GDP에  30%만큼 해당지역에  천재지변이 발생해서  경제가 붕괴했다면 이지역에서 사용될  화폐소비량및 유동성의소비율이 줄어들게되어서 

금리적여력고갈및  재정적 이자지급능력소진을  피해정도에 따라서 영구적또는일정시간동안 지연시킬수있게됩니다.

 따라서, 미래 통화정책적 위기가  금리여력고갈로  이미 정해져 있다 하더라도 , 피해지역에는 불운이지만 이를 통해 국가의 통화정책환경이 위기에서 탈출할수있는 기회가 올수도 있다는것입니다. 

문제는  태풍,지진, 쓰나미, 홍수,가뭄등등의 일반적인 천재지변으론  유동성증가효과의 디플레이션 영향력이   일시적이며  영원하지않다는것입니다.

하지만, 

이를 극복할수있는  영구적인 유동성증가효과를 가진  천재지변이  궁극적으로 나타나는데, 그것이 바로  " 해수면상승" 입니다.

해수면 상승의 천재지변은  일시적이지않으며  그효과가  영구적이기때문에  거시경제상에서의 "화폐경제시스템의 붕괴예방과 수명연장측면"에서       

반드시 필요한 수단에 가깝다는것입니다. 

중요한것은 

인간이 자연현상을 좌지우지할 정도의  과학기술력을 가지고있냐는것이고, 이부분부터  음모론적으로 지구문명보다 앞선 선진문명의 외계인 참여여부가 결정되기때문에  우리가 알지못하는 미지의 지식영역에 해당하게됩니다.

결과적으로  통화정책영역에서 아무리 금리여력이 부족하고 대공황진입이 가깝다 하더라도,

한국속담의 "이가 없으면 잇몸으로 산다." 과 같은 해법은 늘 존재한다 하겠습니다......

Financial capacity to pay interest.(재정적 이자지급능력)

 

Theoretically, the lower bound for interest rates that a central bank can set is zero.

In the context of a monetary system, a zero-interest-rate environment represents a point where a nation’s fiscal capacity to make interest payments is completely exhausted.

The catch is that only nations with highly sophisticated central banking and advanced monetary policy frameworks are capable of reaching this zero-interest-rate threshold.

Let’s look at an example.

Government bond yields relate to the money supply (liquidity), while policy interest rates relate to inflation (as measured by the Consumer Price Index, or CPI).

When the level of inflation (policy rate) is appropriate relative to the money supply (government bond yield), a nation’s fiscal capacity remains sufficient to sustain interest payments even as rates approach zero.

However,

if inflation (policy rate) exceeds what is justified by the money supply (government bond yield), the nation’s fiscal capacity will be depleted by inflation long before it can ever reach a zero-interest-rate state.

Currently, China’s government bond yield (reflecting money supply) is 1.67%, while its policy interest rate (reflecting inflation) is 3.0%.

Even if China possesses the fiscal headroom to reach a zero-interest-rate environment, the excess inflation erodes purchasing power and reduces liquidity. Consequently, the "effectively available" government bond yield becomes 1.67% minus the 1.33% excess, resulting in an effective yield of 0.33%.

Therefore, if China’s government bond yields were to fall by another 0.33%, the country would reach the zero-interest-rate threshold—the point at which its fiscal capacity to meet interest obligations is entirely exhausted. 

The chart displays data on government bond yields and policy interest rates for various countries.

With the exception of China—a nation currently facing a liquidity crisis—most countries are fostering a monetary environment characterized by tightening, which helps keep inflation in check. Theoretically, this creates conditions that would allow these nations to sustain interest payments even if interest rates were to fall to zero.

The issue, however, is that until now, price stability has been maintained using commodities that represent only a small share of the total money supply (excluding oil and natural gas).

If the prices of oil and natural gas—commodities that account for a significant portion of the total money supply—begin to rise toward their "fair" value, most countries will inevitably find themselves in a situation similar to that of China.

In other words, if the prices of oil and natural gas—which hold a large share of the total money supply—increase, most nations would see their fiscal capacity to make interest payments completely exhausted long before reaching a zero-interest-rate environment, potentially leading to conditions akin to the Great Depression of 1929.

Looking back at the Great Depression, long-term interest rates in the United States hit a floor of 2.09%; they never even approached zero.

This suggests that, given the monetary policy environment of that era, the U.S. reached a point where excessive inflation completely depleted its capacity to service interest payments at the 2.09% level.

In conclusion, while it is theoretically possible for any nation to possess the fiscal capacity to sustain interest payments at a zero-interest-rate level, reaching such a state in reality is extremely difficult—a fact that underscores just how challenging it is for central banks to manage inflation. Therefore, among the countries shown in the chart of interest rate trends, those falling into the category of nations facing a high-level liquidity crisis—namely Switzerland, China, Thailand, Singapore, Japan, Taiwan, Sweden, and Denmark—will be the first to fall into a "great depression" (defined here as the loss of the ability to meet interest payments) if they fail to align their interest rate structures with that of the euro—which serves as a key benchmark—before the onset of a rise in oil and natural gas prices.

(원문)

이론적으로  중앙은행이 내릴수있는 금리하한수치는 제로금리입니다.

제로금리는  화폐시스템의원리상  국가가 재정적으로 감당할수있는 이자지급능력 완전고갈되는 영역을 의미합니다. 

문제는 제로금리에 도달할수있는 국가는  중앙은행의 통화정책기술이 높고 선진화된 국가만 가능하다는것입니다.

예)를 들어보겠습니다. 

국채금리는 통화량(유동성)개념이고,  정책금리는 인플레이션(CPI영역)개념입니다.

풀린통화량(국채금리)에대해서 = 적정한 인플레이션(정책금리)이 올때,  국가의 재정능력은  제로금리까지 도달할수있는 이자지급능력을 가지게됩니다.   

그런데.

풀린통화량(국채금리)에대해서 < 초과한 인플레이션 (정책금리)이 올때는 . 국가의 재정능력은 제로금리에 도달하기전 인플레이션에 의해 상실하게됩니다.

현재 ,중국의 국채금리(통화량개념)는 1.67% < 정책금리(인플레이션개념)는 3.0%입니다.  

중국의 재정능력이  제로금리까지 도달할수있는 여유자본을 가지고있다해도 , 초과된 인플레이션으로 인해서  구매력이 하락하면서  유동성이 감소되어 실제 사용가능한 국채금리는  1.67% - 1.33(초과금리)= 0.33%이고 이것이  중국의 실제 사용가능한 국채금리값이 되는것입니다.

그래서  앞으로 중국의 국채금리가  -0.33% 하락하게되면  국가의 재정상  이자지급여력이 완전고갈되는  제로금리에 놓이게된다는것입니다.

그림은 각국의 국채금리와 정책금리 자료입니다.

상위 유동성위기국가인 중국을 제외하고  나머지국가들은  긴축환경으로  적절한 물가억제환경을 만들면서  이론적으로 제로금리까지 이자지급능력을 펼칠수있는  금리환경을 조성하고있습니다.

문제는  지금까지는  유가나 천연가스를 제외한   총통화량에서  화폐점유율이 낮은재료를 가지고 적절한 물가환경을 유지해왔다는것이고,

유가와 천연가스가 가격상승하면서 적절한 가치에 도달하기 시작하면 거의 대부분의 국가는  중국과 같은 처지에 도달할수밖에 없다는것입니다.

즉, 총통화량에서 화폐점유율이 높은  유가와 천연가스가 상승하게되면 ,  제로금리에 도달하기전  거의 대부분의 국가가  재정상 이자지급능력이 완전고갈되면서 대공황(1929)과 같은 환경에 놓인다는것입니다. 

과거 1929년 대공황 시기의 미국의 장기금리를 보면 하한선이  2.09%가 한계였다는것이고 제로금리근처도 도달하지못했다는것입니다.

이는  이당시 미국의 통화정책환경이 2.09% 수준에서  초과인플레이션에따른 이자지금능력의 완전고갈이 발생했단 말할수있습니다.

결론적으로  이론적으론  모든국가가  제로금리에 도달할수있는  재정적 이자지급능력을 가지고있지만,  실제  제로금리에 도달하는것은 매우힘들며  이는 중앙은행의 인플레이션관리가 매우 힘들다는것을 증명합니다.

따라서,  그림의 각국 금리흐름에서 상위유동성 위기국가영역에 해당하는  국가(스위스,중국,태국,싱가폴,일본,타이완,스웨덴,덴마크)들은  유가와 천연가스상승시기가 오기전  기준이 되는 유로와 같은 금리체계를 가지지 못하면  

가장먼저  대공황(이자지급능력상실)에 놓이게 될것입니다......

Macroeconomic Conditions – October 11, 2026.

 

Because foreign exchange markets boast the largest liquidity volume on the planet,

both macroeconomic trends and the direction of central bank monetary policies are inevitably driven by the movement of exchange rates.

In other words, exchange rates dictate fluctuations in currency value and price levels, determine which regions of the world experience low or high inflation,

trigger capital flows, and shape the lifespan of economic cycles—ultimately determining the longevity of the entire monetary economic system.

Ultimately, just as the saying goes that "baseball is a pitcher's game," one could say that "the macroeconomic environment is a game of exchange rates."

The chart shows the trend of the Dollar Index.

Why is France currently pursuing austerity with such desperate intensity—effectively subjecting itself to severe economic hardship?

It is to stem the liquidity drain caused by the weakening Euro, a phenomenon resulting from the strengthening US dollar shown in the chart.

If France did not endure this self-imposed hardship to offset the liquidity shortfall through austerity measures in the face of a weak Euro,

the current strength of the dollar could not be sustained.

In essence, since a strong dollar is built upon the sacrifices of the nations that comprise the Dollar Index (the Eurozone, the UK, Japan, Canada, Sweden, and Switzerland),

if France cannot hold out, a strong dollar becomes impossible.

The problem, however, lies in France's current situation.

While the country is holding on by drastically slashing budgets for education and administrative agencies,

it is pushing past the limits of what the public is willing to tolerate. In other words, the dollar strength shown at point 3 in the chart is a trend driven largely by France’s self-inflicted austerity measures;

this implies that if France can no longer sustain such austerity and teeters on the brink of a liquidity crisis, the current dollar strength becomes unsustainable.

To put it another way,

Japan halted its own austerity measures—which had been triggered by a weak yen—back in July,

and now, there is a growing likelihood that France (representing the Eurozone) will also abandon its self-inflicted austerity.

Consequently, if France fails to prolong this environment of austerity, the euro will inevitably strengthen,

and the Dollar Index will inevitably shift toward a genuine decline, driven by the euro's appreciation.

​Now, let’s circle back to the beginning: I mentioned that "baseball is a game of pitching," just as the "macroeconomic environment is a game of exchange rates," didn't I?

So, what actually happens when the dollar weakens?

​From a macroeconomic perspective, the depreciation of currency value resulting from a weak dollar

is driving us all toward an inflationary inferno.

Status of the Dollar Index

 

Looking at the Dollar Index trend in the chart,

I initially thought the previous "fake" peak marked the final turning point toward a weaker dollar,

but in hindsight, the *real* peak is emerging only now.

Therefore, if the current peak is breached, the Dollar Index will likely plummet rapidly toward the 90 level.

Because the drop is very steep, it seems likely that it will simply pass through the Dollar Index 95–96 level, which is the growth benchmark for companies benefiting from high inflation.

Therefore, the high-inflation phase we are anticipating is likely to unfold much more abruptly than expected, catching market participants off guard.

October 4, 2026 – Macroeconomic Situation

 

France's current level of monetary tightening—measured by the spread between government bond yields and the benchmark interest rate—stands at -2.22, marking the highest level seen in the past five years.

Going a step further,

the French government is implementing fiscal consolidation measures totaling approximately €50 billion to €60 billion (roughly KRW 75 trillion to 90 trillion).

As a result,

the budgets of almost all ministries are being cut, including administrative and project budget controls for major ministries such as the Ministry of Education, the Ministry of Environment, and the Ministry of the Interior.

Furthermore, they are even going so far as to cut the sensitive education budget; this is an austerity policy that approaches the extreme limits of what France can currently implement. 

Protests, road blockades, and public transport strikes are ongoing as student groups, transport unions, teachers' unions, and far-left and opposition political factions join forces.

In addition,

harsher austerity measures are being signaled to reduce the current fiscal deficit ratio from 5% to the EU level of 3%.

All of this ultimately amounts to a desperate effort to prevent the weakening of the dollar index, and represents an austerity environment being imposed on all EU countries, extending beyond France.

The problem is that in Germany, another EU country, the remaining austerity capacity shown in the graph is gradually decreasing to -0.80, indicating that there is very little room left for tightening.

Looking at exchange rates,

Japan—which had previously strived to maintain the dollar's trading range—abandoned its policy of yen weakness starting in July,

leaving Canada and the Eurozone as the only ones still putting up a desperate fight.

The problem, however, is that—as evidenced by the budget cuts across all French government ministries—

the Eurozone is simply not in a position to sacrifice its currency value to support the dollar's trading range.

If you look at the current state of government bond yields across nations,

rising yields in the Eurozone, Japan, and the U.S. have driven monetary tightening to abnormally high peaks,

creating a situation where everyone is struggling under the weight of such aggressive tightening.

If these desperate, heart-wrenching efforts ultimately collapse, what kind of change will follow?

I suspect the answer lies in the as-yet-undetermined range of the Dollar Index shown in the chart.