Name: Why the US is Preparing To Destroy the UK economy
Uploaded: 2026-01-29T18:54:18.000Z
Duration: 16 min 10 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

The United States is preparing to destroy the entire British economy.

If you think that the British economy has been suffering all this time, then you have no idea what's about to happen.

When I researched this video I thought that this is an exaggeration.

But the deeper I digged into it, the more I realized how bad the situation is.

This is not speculation because it is already happening and the average Brit is about to lose his entire life's savings.

Nothing like this has ever, ever happen in the history of the uk.

If you are not mentally ready, please skip this video because what you are about to learn is something that you should not know.

This is something that the government does not want you to know at all.

But if you are ready, then give this video a thumbs up and let's get right into it.

American hedge funds such as Citadel, Baliasney and Point72 have been building a position since 2023 that is about to wipe out the entire British economy.

The British government, just like any government, borrows money by issuing a government bond.

Let's say that the government has issued a 100 pound bond that pays 4% in interest rate.

The hedge fund is going to buy that bond and is going to receive £4 on that investment.

But the hedge fund is not buying it for the sake of holding it.

The hedge fund is instantly going to take that bond and is going to create a future based on it.

A future is basically a contract that says that I'm going to sell you a certain asset sometime in the future for a specific amount of time.

And right now you have to pay me that money.

All you have to do is just put a small deposit and when the contract is going to expire that's when you are going to pay me money.

Let's say that me and you are going to sign a futures contract based on this Apple Watch.

And the contract is going to say that I am obligated to sell you this Apple Watch three months later for 500.

Now the value of this contract is going to fluctuate in the market based on demand and supply.

If Apple tomorrow is going to announce that they are going to introduce a new Apple Watch, then suddenly nobody wants this Apple Watch which means that the of this contract is going to go down.

But we are still obligated to exercise this contract for the specific price that we have agreed.

On the other side, if Apple is going to announce that this was the last Apple Watch in the world and we are no longer going to manufacture any more Apple watches, suddenly everybody would want to buy this Apple Watch, because this was the last one.

Now, the value of this contract in the market is going to rise substantially because there is huge demand for it.

But I'm still obligated to sell you this apple watch for $500 because.

So the value of this future is going to be derived from the government bond that is issued by the British government, because the hedge fund has purchased that British government bond.

But the hedge fund can actually sell this future for $100.

Because if you're holding this future, you're not receiving the 4% interest that the British government is paying, but

rather the hedge fund is actually receiving that, which is why to sell this future, you have to factor in the four pounds that are missing here.

Which is why you can only sell it for £96.

On the other side, you have huge investors, such as pension funds, investment banks, that are investing hundreds of billions of dollars in the market.

These pension funds still have to invest a big portion of their money into the British government bonds because they have no other option, since these are very safe investments.

But at the same time, these pension funds want to actually invest in the stock market or other assets, because Nvidia stocks are rising, Apple stocks are rising.

But we have a very limited amount of money, which is why instead of actually putting upfront our entire money to buy these British bonds, we are going to buy futures whose value derive from the British government bonds.

So three months later or a year later, we can still buy these government bonds for the exact same price that we have agreed.

Meanwhile, we are going to take up our money and invest it in Apple or other major stocks.

When the future contract reaches its maturity date, the value of this contract is at least going to match the price of the the original government bond, because there is no more time left and you're going to receive your money back from the British government.

So the pension fund is going to exercise its futures contract by the British government bond from the hedge fund instantly sell it in the market for the exact same hundred pounds.

Because if I'm going to buy it from the pension fund, then I will receive the exact same hundred pounds from the British government, which is why the demand for futures is always much higher than the demand for the British government bonds to begin with.

And the price of anything in the market is determined by demand and supply.

If the demand is very strong, then the price rises.

If the demand is very weak while supply is very strong, then the price is going to fall.

So because the demand for these futures contract is so insanely, high.

They can be sold for a higher price, which is why hedge funds can sell these futures not for $96 like they supposed to be, but

And the hedge funds are making that profit.

So what is the big problem with this strategy?

The hedge simply making, yes, they're making billions of dollars, but I don't see any problem.

The biggest problem here is that the hedge funds are not even using their money to do these trades.

Because interest rates in the United Kingdom have been rising to 5% by 2023, while interest rates in Japan during this time were negative 0.5%.

These hedge funds could borrow hundreds of billions of dollars from Japanese banks and invested in the UK Treasuries.

The British government bonds are some of the safest investments out there because NO believes that the British government is going to default on these loans.

So these hedge funds could essentially borrow money from the Japanese banks at almost 0% interest rates, or maybe, best case scenario, 0.5% in interest rate and dumped all of that money by buying US treasuries.

And right now they are sitting on £100 billion worth of UK treasuries, and

So these hedge funds only put £1 billion of their money to borrowed £99 billion to buy £100 billion worth of British government bonds and created futures based on this £100 billion and sold them to the UK pension funds.

This doesn't seem like a big problem, but

in reality, this is the biggest danger the British economy has ever faced.

And that's why the bank of England is sounding the alarm and trying to fix it.

But there aren't any good solutions right now, here's how it's going to destroy the entire economy.

Since £100 billion of the UK treasuries are not actually directly owned by the American hedge funds because they only put £1 billion of their money and 99% of that money is being leveraged.

This strategy can only work when interest rates in Japan are low, while interest rates in the UK are very high.

The moment this dynamic is going to change, this strategy is not going to work.

And look at what's happening to the interest rates in both of these countries.

Interest rates in Japan are rising substantially.

They're about to hit 1%, while interest rates in the United Kingdom are falling down below 4%.

So if by the end of the year the interest rates between these countries are going to close much farther, then these American hedge funds that have leveraged 99% of their position have no other option but to close their position to pay the Japanese banks because they are no longer making any money or whatsoever.

The American hedge funds did not use their own money to buy all of these UK Treasuries, but

rather they used a hundred billion dollars of Japanese loans to buy all of these Treasuries and they're making money the difference of this exchange rate.

The moment this business model makes no more sense, then all of these American hedge funds have no other option but to sell £100 billion of the UK Treasuries in the market.

Most people have no idea how severe that could be for the British economy.

Now the total size of the national debt in the UK is about 2.9 trillion pounds.

And 100 billion pounds is about 3.5% of the entire debt.

At first glance, dumping 3.5% of the entire debt, that doesn't actually seems like a big problem.

But the daily volume of the entire debt is about £30 billion.

If you suddenly dump a hundred billion pounds, do you know what's going to happen to the interest rates?

The British government already runs 140 billion dollar in government deficit.

And the vast majority of this money is basically the interest payments that the government cannot possibly afford.

Which is why the government is freaking out.

Interest rates are so high now they have $140 billion in deficit that they have to close and they don't know how to do that.

They want to introduce wealth tax, they want to introduce more taxes because they need to raise this money from somewhere in order to fix the government's deficit.

And dumping £100 billion of the UK treasuries in the market is going to spike the interest rates by about 1 to 2% in the best case scenario.

So I'm here to be as optimistic as possible.

I'm not trying to assume that it's going to increase the interest rates by 3 or 4%.

Because if that is going to happen, that is literally the end of the Britain as a country.

If interest rates are going to increase even by 1 or 2%, that is going to cost the British government by at least extra 30 to 60 billion dollars.

So the total deficit is going to rise from 140 billion pounds to as much as 200 billion pounds.

If you think that the situation is so bad right now when the government has $140 billion deficit, what do you think is going to happen when the deficit is going to rise?

At that point, they're going to double taxes on everything just to ensure that the government is not going to go bankrupt.

And if you think that this is the entire problem, then you have no idea what's about to happen, because the situation is way worse than you can possibly imagine.

And what I have explained just now is just one tiny, small part of the problem.

The biggest disaster is that the British pension funds own 20% of the entire UK debt.

People are paying payroll taxes so that when they retire, they will be receiving money from the government.