COMMENT: Mr. Armstrong, I just wanted to thank you for the education. When you explained that Bitcoin was not some hedge against central banks or an exception to everything out there but was just another trading vehicle, you saved my life for sure my wife would have killed me during the crash. The November turning point proved correct. Now we head into some very interesting times with Directional Changes ahead. The bounce now is the same pattern you see in gold. It is just a trading vehicle and not a store of wealth. Thank you for that reality check.
Sam
REPLY: Yes, spousal abuse can be a major deterrent. Merrill Lynch paid me to teach a client how to trade who had created the biggest one-day loss perhaps in trading history and wrote a check and kept trading. I got him to pay more attention, but when he was winning, he was too busy to watch. He seemed to love to lose money for that got him all geared up. It was his wife that made him stop trading.
Look, Bitcoin is NOT some store of wealth. You will lose your shirt, pants, and spouse if you buy into that. It is a trading vehicle – nothing more. Just follow Socrates. That gives at least an unbiased viewpoint. What goes up, comes down and what goes down eventually goes up. That is just the law of the market.
The Chinese yuan has out-traded the US dollar by volume for one of the first times in recent Russian history. The dollar was king in 1991 when the Soviet Union collapsed, but that is no longer the case after Moscow branded the dollar a “toxic currency” along with the euro. Toxic currencies accounted for 87% of exports from Russia at the beginning of 2022, but this figure fell to 48% by the start of the new year. The Bank of Russia has reported that the proportion of USD/ruble pair in exchange fell to only 36% in February. The central bank is calling this a “broad structural transformation of the Russian economy.”
As “unfriendly countries” and their “toxic currencies” band together, those on the outskirts are winning. China has become the new go-to country for new trade partnerships as it bypasses Western-imposed sanctions. Toxic currencies represented 46% of imports in December 2022 but were at 65% in January 2022 before the war. In contrast, the yuan’s share rose from 4% to 23% during that time.
Those who were previously shunned from the big table are now pulling up a chair to discuss economic prospects with China. This will make it much easier to phase out toxic currencies because more people are willing to accept the yuan. The confidence in the yuan is growing. Everything occurring may seem odd, but it is precisely on target. As I mentioned in my report“China on the Rise,” China will dethrone the United States to become the world’s leading economic powerhouse by 2032. It’s just time.
The Biden Administration is responding to the panic phone calls that their Marxist philosophy will bring down the entire financial system. My ear is red as can be. I have had enough of the phone calls today to last the balance of the month. Trying just to do the right thing! Three banks have effectively gone down in the week of March 6th, which our computer was targeting. There have been Silicon Vally Bank, Signature Bank, and Silvergat Bank.
The Regulators perhaps saw the handwriting on the wall. This NO BAILOUT claiming that no taxpayer money will be used for a bailout of their hated rich, how about just using the taxpayer’s money you are throwing down the train in Ukraine? Depositors in Signature and SVB they are now saying would be made whole. If they do not cover ALL deposits, the monumental banking failure will be catastrophic.
Our forecast for a Banking Crisis is by NO MEANS confined to the United States. It will be far worse in Europe. We can see our computer not only targeted 2023 for a key turning point with a Directional Change but a Panic Cycle next year in bank stocks, but interest rates will be rising higher as also the risk of banks and governments escalated especially when they insist on waging war against Russia.
The yield curve is critical and we must understand that this insane war against Russia, even economically, will be a major financial disaster not much different from Vietnam which brought down Bretton Woods and forced Nixon to close the gold window on August 15th, 1971. It was that unrestrained spending directed by the Neocons. Then too, it was all about Russia they assumed was behind Vietnam.
Once more, the reckless spending on war promoted by the Neocons is undermining the entire economy. They have lost every war they have promoted – Vietnam, Afghanistan, Iraq, proposed Syria, Libya regime change, and now Ukraine. These people are never held accountable for all the devastation and the lives lost.
War is the primary driver of inflation and the central banks will not even address it for they do not want to “criticize” the Neocons. They might wake up with their dog’s head in the bed as in the Godfather. The central banks will NOT be able to contain this inflation or ever reach their 2% target regardless if the economy turns down just as what happened during Vietnam.
This is a warning to all small banks. Understand the REAL trend or you will NOT survive. Major capital is fleeing the long-term and rising into the short-term because they see rates are rising and any long-term bond investment during a period of war is going to be a major losing trade. Do not get trapped by the yield curve and understand that this trend is in play into 2025.
This Banking Crisis has been caused by Governments who artificially kept interest rates too low since 2008 and in the process, this banking crisis is unfolding because too many banks are UNSOPHISTICATED in forecasting and have been listening to the talking heads on TV and the desperate hope that inflation will decline while ignoring Ukraine entirely. Get that wrong – and you will NOT survive.
I strongly urge small banks to take our business services for access to real forecasting that is not biased or tarnished by human opinion with the two most dangerous words in forecasting:
Posted originally on the CTH on March 11, 2023 | Sundance
South Dakota Governor Krisi Noem appeared on Tucker Carlson’s television broadcast last night to send a warning to fellow governors. According to the background story, the South Dakota legislature passed a bill redefining currency and creating rules for a Central Bank Digital Currency (CBDC) that would block all other digital currencies from being used in the state. Governor Noem vetoed the bill.
When asked why her legislature would do this, Noem responded the state politicians likely did not read the bill as it was constructed by lobbyists. Noem is exactly correct and hits on a subject we have discussed here frequently {GO DEEP}. However, one of the more alarming aspects to Noem’s discussion of the issue is that around 20 other states are considering similar legislation. WATCH:
QUESTION: The sales pitch seems to be that there is this $2 quadrillion in global debt that overhangs everything. Paper assets, therefore, will all implode! They seem to be saying that everything has risen due to this debt bubble and it was all created with Zero interest rates. Now that they are going up, the debt bubble will burst and everything will decline. The story seems to be that this decades-long Boom Bust cycle was created over and over by the Federal Reserve.
This seems to be like you have said, they try to reduce everything to a single cause and effect.
What really happens?
PCJ
ANSWER: These people seem to keep preaching the same story but have no historical understanding whatsoever of how the monetary system has ever worked. Their focus on the Federal Reserve shows that they are not looking at the world economy and they do not even comprehend how bad things really are outside the United States. They do not comprehend what is an interest rate. It is the compensation to a lender for his anticipation of inflation plus a profit. If I think the dollar will decline by 50%, why would I lend you dollars for a year if when you pay me back it buys half of what it did when I lent it to you?
Debt can be a performing asset. I advised many of the Takeover Boys during the 1980s. We would borrow in one currency to buy the asset in another using the computer to distinguish the long-term trends. I would not recommend that to someone just operating on a gut feeling.
We were also advising on real values, which Hollywood distorted and based the movie Wall Street with Michael Douglas and his famous speech on greed. What they did not really understand was that after a Public Wave that peaked in 1981, stocks were suppressed and the full-faith in government created the broadly supported bond market. Hence – bonds were conservative and stocks were risky. There were two aspects that were behind the entire Takeover Boom.
First, I was showing these charts and how in terms of book value, the Dow Jones bottomed in 1977. It was obvious that if you could buy a company, sell its assets, and double or triple your money, then the market was obviously not overpriced. We had forecast that the Dow was undervalued and that it would rise from the 1982 low of 769.98 and test the 2500 level in two years in 1985. Indeed, it reached 2695.47 by September 1987. We also projected that by the next decade, the Dow would test 6,000 on its next rally.
Even the press in Japan was shocked. We were also projected that Crude would fall below $10 in 1998. Indeed, that forecast was covered by Mark Pitman at Bloomberg News. It bottomed at $10.65 in 1998. In gold would forecast that it would drop to test $250 by 1999 completing a 19-year cycle low. Then gold would rally to test 1,000. Gold reached the $1,000 level by 2008. The Japanese press thought those forecasts were wild, to say the least.
The SECOND aspect of our advice to the takeover boys of the ’80s was something the press NEVER understood. We would advise borrowing in one currency for an asset in another. We were able to turn debt into a performing asset. We would make 20-40% profit on the currency alone. Often, the press would just look at the debt and not understand what we were even doing.
Most of this reasoning stems from Sir Tomas Gresham’s observations when he represented England at the Amsterdam exchange during the reign of Henry VI’s reign and debasement. As Henry debased the silver coinage as was taking place in Spain, the more they debased the coinage, the higher the inflation took place. His observation that bad money drives out the good has been grossly misunderstood. When I was growing up, they took the silver out of the coinage in 1965. People were culling out the silver showing that the debased new coinage of 1965 drove out of circulation the old silver coinage. The same thing has taken place with the copper pennings.
Because people hoard old coinage, the money supply shrinks. That then forces the government to issue far more debased coinage to compensate for the coinage that has been withdrawn from hoarding. Consequently, inflation unfolds for all tangible assets to rise in value as expressed in the newly debased coinage.
What these people always try to sell is the same old scenario that they cannot point to a single instance in history where everything collapses to dust but only gold survives. Such periods will typically result in revolution. When Caesar crossed the Rubicon, that was also all bout a debt crisis.
You must also understand that interest rates will be at their LOWEST internationally in the core economy of the Financial Capital of the World – which is the USA right now. The further you move from the center, the higher the interest rate will be. Hence, I have warned that the United States will be the LAST to fall – never the first. This is not based upon my opinion, this is simply historical fact.
The Bottom Line is very simple. There is just no such period as people describe where everything turns to dust and only gold survives. Even if that were true, they what good would the gold do if everything else is worth ZERO? Gold would have also ZERO value since nothing would have value.
The real issue is that as government defaults unfold, tangible assets will rise in value for the amount of money in debt always dwarfs that in even the stock market. We are in a Sovereign Debt Crisis and that is very different from a private debt crisis.
QUESTION: Do you think that this entire scam with cryptocurrencies that the government will be able to track, do they realize that in war you take down the power grid and all digital currency fails? If the backup system is destroyed, all your digital currency will vanish. Are they this stupid? Is this why they have shills saying you are wrong?
HK
ANSWER: Yes. I have spoken to people involved in creating this insanity. First, they do not think there will ever be a nuclear war. Second, they really do think that they will create regime change in Russia at the expense of probably every Ukrainian alive today who are fools being led to the slaughter. When I have brought up the subject – WHAT IF YOU ARE WRONG! They dismiss it and do not even entertain plan B. The whole digital currency is all about tracking every dime. I have said many times, this is all about the new world order which is Schwab’s Great Rest and he knows that is our 2032 forecast. They all believe that forecast and are preparing to redesign the world this time to achieve their totalitarian dreams.
When I asked – Did you authorize Bitcoin? They just do not reply. Silence is golden. The launch of Bitcoin was just too damn convenient. That was standard operational political tactics – you float a balloon and see how the people accept it.
If you have ever been to Nuremberg, Germany, they have a bronze statue there – the Ship of Fools. The sculpture named Ship of Fools by Jurgen Weber is based on the satirical allegory by Sebastian Brant. This is now a reality.
COMMENT: Mr. Armstrong, Now with Switzerland outlawing a cashless society, I understand your point that cryptocurrency is really a dead end. Without power, it cannot exist and as you said in times of war, you take down the power grid and they can do that with an EPM pulse. These Bitcoin zealots are clueless about history and humanity. It’s just another way to separate a fool from his money.
Thank you for the education
BH
REPLY: The whole blockchain was the perfect creation of a totalitarian state. They can trace everything. How would you bribe politicians? It would all have to revert to barter. Do this and I will give you that – off the grid. This is why people are still buying real estate, precious metals, ancient coins, art, collectibles, and various things that are tangible and are thus off the grid.
Having funds in any cryptocurrency is still on the grid. When I was one of the three top market-makers in gold back in the ’70s, the IRS walked in and said they declared me to be a bank. Thus, I was supposed to report every transaction of $10,000 or more. They acknowledged I did not realize I was a bank, so they waived the fines. They seized all my records and went off to audit over 3,000 clients. They claimed that gold was not DEMONETIZED as money, just suspended for a while. I retired because I was supposed to report customers but not everyone else in the field. My lawyers said I could fight it. It would take years. My model warned that gold would decline for 19 years anyway so I choose to retire. The clients still wanted the research and thus Princeton Economics was spun off separately.
They can declare every person running an exchange in crypto is now a bank and must report every transaction. They can be put them out of business in the blink of an eye. These people have no idea who they are messing with. You will not win. All this is because of their twisted view of fiat money. They no more understand money and assets any more than Karl Marx.
During inflation, assets rise in value, and money declines. That took place during the 19th century when a gold coin was money. MONEY has NEVER been of a constant value – NEVER! These people yelling fiat simply do not comprehend that for thousands of years, there has always been a business cycle and that means money rises and calls in purchasing power REGARDLESS of whatever it has been. The fiscal irresponsibility of governments is well documented throughout history long before paper money.
Even under a gold standard, there were periods of inflation and deflation. Read the history of the California Gold Rush. During the 1849 Gold Rush in California, the journalist for the New York Tribune, Bayard Taylor (1825-1878), arrived in San Francisco by ship during the summer of 1849. He was shocked at what he encountered and did not think that anyone would even believe what he was going to write. His dispatches about the gold rush economy in California stunned many and helped to create the 1849 Gold Rush.
The average wage for a laborer in New York was about one or two dollars a day. In California, individual hotel rooms were rented to professional gamblers for upwards of $10,000 a month, which is the equivalent of about $300,000 today. The degree of inflation in terms of gold was astounding and lacks comparison in modern times. There was so much gold, that the value of goods rose even though they did not in New York. The inflation phenomenon was local.
Gold became so common; they were even striking $50 gold coins in California when $20 was the highest denomination elsewhere and $1-dollar coins down to 25 cents all in gold. Eventually, there were $1 gold coins minted in the United States for general circulation throughout the USA. Indeed, Taylor wrote:
“[One] citizen of San Francisco died insolvent to the amount of forty-one thousand dollars the previous autumn. His administrators were delayed in settling his affairs and his real estate advanced so rapidly in value meantime that after his debts were paid, his heirs had a yearly income of $40,000 [$1.2 million today].
“These facts were indubitably attested; everyone believed them, yet hearing them talked of daily, as matters of course, one at first could not help feeling as if he had been eating ‘of the insane root.’”
It does NOT matter what is money. It will always rise and fall as measured against tangible assets as it has done since Babylonian times. In fact, the very first attempt to control inflation, as the central banks are doing right now, were the wage and price controls put in place by the legal codes of the Assyrians and Babylonians.
So – stop the BS. Understand that there are times when CASH will be king regardless of what money is at that moment in time, and then it will fall in value when everyone wants tangible assets. There is a business cycle – learn to live with it and we will be better off. The hard-nosed cryptocurrency zealots will never admit they are wrong. They are like politicians and will cling to their theories no matter what evidence you show them.
I asked one once, to name a single period in history where money was constant and never declined in value. He could not!
Bitcoin is an instrument for trading. This very chart CONFIRMS it is by no means a store of wealth. It rises and falls like ant commodity of stock. It is still influenced as part of the business cycle. Sorry – there is NOTHING that is a perfect store of wealth. Everything fluctuates. Trade Bitcoin, that is fine. But do not make a religion out of it for you will lose not just your shirt, but your pants as well.
It turns out that North Korea-backed hackers stole a record $1.7bn of cryptocurrency in 2022, according to blockchain analysis firm Chainalysis. It also appears that they had a hand in the collapse of the cryptocurrency exchange FTX where the auditors have reported that around $415m of cryptocurrency has been stolen by hackers. This is becoming a very interesting story with several facets from funding North Korea to laundering money for Zelensky to pay off the Democrats for the Midterm elections.
There is no way they will let this case go to trial. They will have to cut a deal or they are going to need to have some pumped-up loser kill him when on bail, or Judge Lewis Kaplan will have to revoke his bail and put him in MCC where they can kill him easily and blame another inmate and the guards fell asleep once again and, of course, the camera didn’t work.
At the end of the day, North Korea has been making a lot of money hacking into cryptocurrencies. Your crypto is going to a good cause – World War III to achieve Bill Gate’s dream – population reduction since the vaccines did not kill enough people off – yet.
Posted originally on the CTH on December 22, 2022 | Sundance
FTX Founder Sam Bankman-Fried waived an extradition fight and U.S. Marshals flew him from the Bahamas to New York late Wednesday night. Appearing in a Manhattan court today, the judge set bail at $250 million and permits SBF to remain under house arrest at his parent’s California home until trial begins.
Additionally, it was revealed that Carolyn Ellison, 28, the former chief executive of Bankman-Fried’s trading firm, Alameda Research, and Gary Wang, 29, who co-founded FTX, pleaded guilty to charges including wire fraud, securities fraud and commodities fraud. Both are cooperating witnesses with the prosecution against the FTX founder.
New York – The cryptocurrency entrepreneur Sam Bankman-Fried can post $250 million bond and live in his parents’ home in California while he awaits trial on charges that he swindled investors and looted customer deposits on his FTX trading platform, a judge said Thursday.
Assistant U.S. Attorney Nicolas Roos said in U.S. District Court in Manhattan that Bankman-Fried, 30, “perpetrated a fraud of epic proportions.” Roos proposed strict bail terms, including a $250 million bond and house arrest at his parents’ home in Palo Alto, California.
An important reason for allowing bail was that Bankman-Fried agreed to waive extradition, Roos said.
Magistrate Judge Gabriel W. Gorenstein agreed to the bond and also approved the house arrest proposal. He also said Bankman-Fried would be required to get an electronic monitoring bracelet before leaving the Manhattan courthouse.
[…] Prosecutors and regulators contend that Bankman-Fried was at the center of several illegal schemes to use customer and investor money for personal gain. He faces the possibility of decades in prison if convicted on all counts.
In a series of interviews before his arrest, Bankman-Fried said he never intended to defraud anyone.
Bankman-Fried is charged with using money, illicitly taken from FTX customers, to enable trades at Alameda, spend lavishly on real estate, and make millions of dollars in campaign contributions to U.S. politicians. (read more)
This is a library of News Events not reported by the Main Stream Media documenting & connecting the dots on How the Obama Marxist Liberal agenda is destroying America
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