Category Economic Subjects

Aug 20 2019

Why the Remain Politicians Only Speak their Own Self Interest


Armstrong Economics Blog/BRITAIN

Re-Posted Aug 20, 2019 by Martin Armstrong

COMMENT FROM UK: On the subject of Phillip Hammond and Brexit, this is just the latest in a long list of pro-elite politicians who are looking to protect their career interests by aligning with the globalist system.

Blair made hundreds of millions, Brown and Darling bailed out the banks and then went to work in the financial sector and failure that is Nick Clegg is now an exec at Facebook. Theresa May will no doubt have her payday coming. These politicians are selling out their country but seem to think they have morality on their side.

K

REPLY: All of these politicians who are for the REMAIN side, which included Theresa May, all have a self-interest which is counter-trend to their own country. They like the establishment of the political class to be left alone.

This is a chart that speaks 1,000 times that Britain has NEVER received a fair deal since joining the EU. This is data from your own government which I have not altered. The peak in GDP took place in 1973 just before Britain joined the EU. There was a major faction that believed joining the EU would create a global economy that would surpass the USA. That never happened because each member state can veto what any other state tries to do. There are 50 states in the USA. They have no say if Washington wishes to do a trade deal. If every state had a seat at the negotiation table as they do in the Eurozone, nothing would ever get done.

All I can say is the EU is a dictatorship for nobody at the Commission level ever stands for an election. As such, this is a politician’s greatest wish – power without accountability. And then they have the audacity to criticize China or Russia for a lack of Democracy?

The recent polls in Britain show that the people are MORE AFRAID of Labour and Jeremy Bernard Corbyn than they are about BREXIT!

Aug 20 2019

BREXIT & the Yellow Hammer Propaganda Pretend Leak


Armstrong Economics Blog/BRITAIN

Posted Aug 20, 2019 by Martin Armstrong

The report that paints the darkest possible scenario for Britain without ever mentioning that 60% of its trade is outside the EU and that any attempt by the EU to punish Britain will destroy the German economy which is preparing for a very deep recession since Britain is its #1 trading partner in the EU particularly for autos.

This Yellow Hammer report leak is clearly a scaremongering edition and not serious research. It is just a propaganda piece for that purpose. It claims that transport disruption will be 50%-85% of lorries travelling across the Channel may not be ready for French customs. The EU is likely to harass Brits with immigration checks at border posts. Medicine supply chain may be disrupted for up to six months across the Channel. The supply of certain types of fresh food will decrease.

The EU will slap tariffs on British fuel imports so they forecast financial losses and the closure of two refineries resulting in about 2,000 direct job losses. And as far as Northern Ireland is concerned, the UK would impose the “no new checks with limited exceptions” but they report claim this will be unsustainable.

There is no mention that trade negotiations with the rest of the world cannot take place inside the EU because any member can veto a UK trade deal with anyone.

The British pound is still under pressure as the propaganda machine is in full force. A further decline in the pound into October will far outweigh any tariffs the EU could possibly impose. Everyone looks at the dire future for Europe while they fail to look at the EU. Germany is imploding economically. The German economic philosophy has always been the old-school Mercantilist view to sell more stuff to everybody else than you buy.

While Germany is all about austerity, it has over-taxed its people and has declined to create a domestic consumer market preferring the export model which has resulted in the German people having almost the lowest net worth in Europe. While the economy is #1 inside the EU, the wealth does not pass to the people. A no-deal BREXIT will hurt the EU far more than it will hurt Britain and that is the absolute TRUTH!!!!!!!!

Aug 19 2019

Kamala Harris – Medicare for All


Armstrong Economics Blog/Opinion

Re-Posted Aug 19, 2019 by Martin Armstrong

QUESTION: Marty, what do you make of Harris’s Medicare-for-all plan joining Bernie Sanders? Is this just another way the destroy the society?

HY

ANSWER: There is a HUGE problem nobody seems willing to address. People compare US healthcare costs to those of places like Britain. The problem is that we have a private system and in Britain, the doctors work for the government. Harris’s plan is sort of a hybrid and it would be phased in over 10 years making it another government disaster. All we need to do is look at the VA hospitals. Government is simply incapable of managing anything and then misconduct and mismanagement are exempted from exposure when it is politically important for an election.

Unlike Sanders’, Harris’s plan would include a substantive role for private insurers, which would still be able to offer plans under a tightly regulated system, similar to the way that private insurers currently do through Medicare Advantage.

Additionally, it would transition Americans from the existing system to Medicare-for-all in 10 years, instead of four. And finally, it would use a slightly different payment mechanism: Harris backs several of the methods Sanders has suggested, including higher capital gains taxes, but would only impose taxes on households making $100,000 or more. Sanders’ plan, meanwhile, would impose taxes on households making $29,000 or more.

Healthcare is pricing itself out of the economy. We cannot create a hybrid system leaving private doctors yet 100% coverage under the current system. The VA hospitals prove government cannot be trusted with management. That means we have to create a system that is private yet not uncontrollable.

I would encourage private Medicare-for-all hospitals by treating them as a public utility and to create an incentive for existing hospitals to convert eliminating private insurance entirely. We do that by making them TAX-FREE and all procedures would be priced at a fixed rate with a standard profit margin. No more $500 for a $50 brace.

There are doctors who have been in private practice who have left and gone to the VA because it has become so insane. Many foreign immigrants come into the USA to get lucrative jobs as doctors with a medical degree. Then there are young people who want to become doctors because of the money rather than to help people. Nevertheless, there are a lot of people who want to help people and they would switch over in a heartbeat if we created a viable system.

I have had friends who had local private practices who have effectively been forced to join hospital groups. We have an explosion of Urgent Care centers created which compete against private practices. I have had discussions with those in hospital groups who have said decades ago that they would take that over private practices. That has been the trend.

We can encourage existing groups to switch to a Medicare-for-all system by making them TAX-FREE provided they agree to control over pricing as is the case in public utilities

Aug 18 2019

Socialism Does NOT Work | John Redwood | Oxford Union


OxfordUnion

John Redwood gives his argument that Socialism does not work. SUBSCRIBE for more speakers ► http://is.gd/OxfordUnion John Redwood opens with a hilarious example of socialism failing by pointing out the fact that the President of the Oxford Union sits high above everyone else in the chamber, stating that these people will most probably become political leaders and so is a shining example that privilage is alive and well. He goes on to highlight the differences between traffic lights and roundabouts using them as metaphors for socialist and communist systems. Filmed on Thursday 28th November 2013 MOTION: This House Believes Socialism Will Not Work. RESULT: Motion Defeated

 

Aug 18 2019

Socialism Does NOT Work | Daniel Hannan | Oxford Union


Daniel Hannan gives his argument that Socialism does not work. SUBSCRIBE for more speakers ► http://is.gd/OxfordUnion Daniel Hannan opens with a quote from a from a previous socialist known as Adolf Hitler. The socialist voters elevated cohersion over freedom. The human nature of dog eat dog and ambition to do well was harnessed by capitalism to a socially useful end. He highlights that there are no socialist countries in the wolrd today (e.g. Cuba, Zimbabwe etc) that have persormed better than capitalist one. He concludes his rousing speech with by saying socialism does not work and the house must vote for freedom. Filmed on Thursday 28th November 2013 MOTION: This House Believes Socialism Will Not Work. RESULT: Motion Defeated

 

Aug 16 2019

Difference Between Hyperinflation and Currency Inflation


Armstrong Economics Blog/Economics

Re-Posted Aug 16, 2019 by Martin Armstrong

QUESTION: What is the difference between asset inflation and hyperinflation? I believe you are saying that from Jan 2020 we will see inflation which I understand to be asset inflation?
Thanks
FL

ANSWER: Asset inflation is typically a reflection of a decline in the value of the currency, but this can be 50% over the course of one to two years. Hyperinflation typically occurs when confidence in the government itself completely collapses. This is usually in a peripheral economy or often in times of war or major domestic revolution, as was the case with the Continental Currency in the United States and the Assignats of the Revolutionary government in France. Asset inflation can be also caused by an investment boom concentrated within a single sector such as the Dot.com Bubble. The typical definition of hyperinflation is when prices rise by more than 50% per month over a period of time.

Then there is DEMAND inflation, which is typically one of two aspects. It can come in the form of a hot item like Pet Rocks, Cabbage Patch Dolls, etc. The second aspect is a shortage of something such as wheat or corn and the demand forces the price to rise.

Categories: Economics
Aug 16 2019

Nails It – Economic Analyst El-Erian: The Era of “De-Globalization” is Here…


Re-Posted from The Conservative tree house on August 15, 2019 by 

Finally an economic analyst gets prime-time media pundits to listen as he describes the fundamental difference between the U.S. “Economy” (Main Street) and the U.S. “Markets” (Wall Street).  Charles Payne understands most of this, but El-Erian has it nailed.

Allianz Group chief economic advisor, Mohamed El-Erian, accurately describes what is happening in an era where deglobalization is taking place. The U.S. economy is strong; however, the multinationals on Wall Street -invested overseas- are exposed.  Thus there’s a disconnect and accompanying market volatility.

This is well worth watching because this is the first well-regarded financial pundit that is speaking truth to Wall Street in terms the panel pundits will understand/accept.

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There is nothing that China and the EU can do to stop the de-globalization process; and efforts to stimulate their economy, more quantitative easing (pumping money) while the global supply chains are being shifted, are futile.

The more a nations’ economy is dependent on exports, the more exposure they have to the inherent downsides of de-globalization.   U.S. companies that are invested in these nations will lose their investment over time; some rapidly.  This will keep the stock market volatile, yet the Main Street USA economy is thriving.

President Donald Trump has purposefully stalled the process of globalization, and is resetting global supply chains. This is bringing massive amounts of wealth back into the United States.

In essence Titan Trump is engaged in a process of: (a) repatriating wealth (trade policy); (b) blocking exfiltration (main street policy); (c) creating new and modern economic alliances based on reciprocity (bilateral deals); and (d) dismantling the post WWII Marshall plan of global trade and one-way tariffs (de-globalization).

Aug 15 2019

World Crisis Coming Soon


Armstrong Economics Blog/Economics

Re-Posted Aug 15, 2019 by Martin Armstrong

The world is in a complete midlife crisis or some may say an end of life crisis. I am overseas as the world is simply going nuts. At times, I feel more like a shrink having to reassure people that it will all be OK. Both Europe and Asia are having a very bad string of days.

Asia is concerned that China will intervene in Hong Kong. Protesters in Hong Kong seem undeterred by China’s thinly veiled threat of sending in the armed forces. But Beijing would pay a steep price if it were to send in troops politically. Trump has stated that he regards it as an internal matter for China, while even Mitch McConnell said sanctions would be appropriate. Footage has surfaced on the Chinese internet showing columns of armored vehicles heading south and converging on the city of Shenzhen. The videos seem to suggest that the Chinese People’s Armed Police Force, a heavily armed paramilitary unit, is gathering on the Hong Kong border.

Meanwhile, back in the old world, the EU seems more intent on preserving their power than any rational review of economics. They seem to be doing whatever they can to bury the European economy under this crazy idea of federalizing Europe in a half-ass way that still leaves the individual states in an impossible position to ever reach a unified agreement about anything.

Meanwhile, the former Chancellor Philip Hammond has accused the PM of trying to wreck the chance of a new Brexit deal, by making demands the EU could never accept. He seems to be more on Brussel’s side than his own country. Mr. Hammond said a no-deal Brexit would be “a betrayal” of the 2016 referendum result and that he vowed that Parliament would “make its voice heard,” adding that a no-deal “must not happen.” There is no question that Germany will be the biggest loser and then there is Ireland who does not want an EU version of the Berlin Wall. More than 50% of trade for Britain lies outside of the EU, but a no-deal is far better for it will be able to negotiate trade with the rest of the world not subject to French supervision.

Additionally, with the chaos in Asia and in Europe, the US is still the safe-haven. This could push the dollar into record highs by creating a panic of vertigo that may force the world to sit back down and renegotiate how the world monetary system will survive. Alternatively, we all just all shoot it out and build walls to retain domestic absolute control.

The problem with the collapse of socialism is that the promises made to retain power cannot be supported. The Pension Crisis will explode and at the currency projection, by 2032, we will be looking at a $400 trillion unfunded catastrophic liability. There is no way we could even make it that far. We will be looking at this during the WEC in October (tickets are still available).

Categories: Economics