Armstrong Economics Blog/Sovereign Debt Crisis
Re-Posted Mar 17, 2017 by Martin Armstrong
QUESTION: Mr. Armstrong, you’ve mentioned the term “Crash and Burn” many times over the last few months. My question is, what will the “Crash and Burn” look like? Will it be worldwide or specific to a few countries like the US? Will it be in the form of a financial crash, food shortages, violence in the streets, all the above or in some other form? Could you please provide your vision of what the crash and burn might look like as I try to prepare my family for what lies ahead.
Many Thanks for your valuable insight.
ANSWER: I am referring to government – not markets. We can see the meltdown in politics going on. The left is fighting so desperately to stop Trump; if not impeach him. Let’s say they succeed in impeaching him. What would really happen? Trump won the majority of people in the country with the single exception of California, which is indeed La La Land. They would be the sixth largest economy in the world by themselves, but California does face some very serious economic issues. The majority of its economic growth has all been concentrated in Silicon Valley and San Francisco, leaving the state vulnerable just in case the tech economy sours. This is also creating a much wider gap between the rich and the poor than in most other regions in the country. When Southern California gets tired of complaining about Trump, you will see them turn against the North, demanding their money to pay for their lifestyle.
If the left were to succeed in getting rid of Trump, you will see the silent majority who put Trump in office because all they see is a constant dwindling future with the highest taxes and a declining standard of living suddenly not be so silent. They are NOT going to take this abuse of the left any more by people who just want to subjugate them and destroy the future of their children. The economics behind what put Trump in office is only going to get far worse.
When I was young, I was naive and stupid. I tried to turn the tide in Washington. I donated my time to keep my independence, never taking a dime for anything. Once you accept ANY money from these people, they own your soul. That is why every time crisis comes, my phone rings because they know I will tell them the truth and not what I am being paid to say.
Consequently, I simply gave up. I have worked behind the curtain for 40 years even testifying before Congress and answering questions in the middle of a panic. There is absolutely NOTHING anyone can possibly do to change the trend – IMPOSSIBLE. Let me explain what politics is all about and why the left should really embrace Trump to save their own ass for the future.
If I was to run for reelection and said vote for me because I saved your job, would you believe me? Chances are you would ask, how do I know I would even have lost my job? It is far better to allow a crisis to unfold, for then your emotions will be running high and you want revenge for your loss. That is when politicians will say: Vote for me, I’ll get the guy that did this to you!
As a result, there is nobody in Washington, Republican or Democrat, who would prefer to prevent a crisis when they will never receive a vote or any credit. It is always better to allow the crisis and then emerge as your champion. Therefore, the sad realization is that we simply must CRASH & BURN, for only then will anyone pay attention.
Keep in mind that this CRASH & BURN is government – not the private sector. Therefore, the danger lies in government assets – not private sector assets – stocks, real estate, and tangible assets.