Tag Archives: 2020

Mar 25 2021

The Greatest Female Trader of All Time?


Armstrong Economics Blog/Traders Re-Posted Mar 25, 2021 by Martin Armstrong

QUESTION: First I want to thank you for your guidance. You have helped me understand markets where I can see I was clueless before. You seem to be a contrarian. I take it that is why you say the majority must always be wrong. Have you learned this to be the best way to look at the world?

Thank you for shining a light in these dark times.

GR

ANSWER: The greatest traders of all time have always been contrarians. They can see the patterns within patterns and how history repeats right before their eyes. Jesse Livermore (1877 – 1940) turned bullish in 1923. He could see the bull market coming. The Wall Street Journal accused him of turning bullish to influence the presidential elections. When they were proven wrong, they simply refused ever to quote Jesse ever again. Many have pointed out that Barrons had reported that our model was calling for new highs back in 2010 more as a joke. They have never reported ever again how it was correct. It appears that the media does not like it when they are wrong and will retaliate.

Hetty Green (1834-1916) was a woman in a man’s world. She became not just one of the wealthiest and most astute investors in American history, but she became the richest woman perhaps in the world. Hetty’ was known for her extreme frugality, which was exploited by her adversaries and made for good copy in the press. They dubbed her the “Witch of Wall Street” because she was such a good trader her wealth could outdo even the top ten Wall Street bankers in her day. She was in reality a woman in a man’s world, during the era of robber barons when deals were done in dark oak wooden rooms filled with cigar smoke clouds that you would think it was going to rain.

Her reputation as the “Witch of Wall Street” was undeserved and today they would call it sexist. Hetty was the first female billionaire in modern terms who would be worth $10 billion+ in 2021. When she died in 1916, she was worth between $100-$125 million when a dollar was really worth something. She actually despised many of the titans of industry and finance of the day for their predatory ways and profligate spending. She actually sympathized more with the average hardworking citizen, yet she followed in her father’s Quaker footsteps.

Hetty Green was the woman of the Gilded Age. Few men could compete with her mentally. Hetty was abandoned at birth by her mother and she was viewed as a female by her father. Against this backdrop, Hetty set out as a child to prove she was of substance and had value. She followed the simple rules of her wealthy Quaker father, and always was extremely frugal. She would accompany him to the counting houses, storehouses, commodity, and stockbrokers. She observed trading from an early age and clearly saw the patterns within patterns.

While she inherited money, she understood trading. Perhaps her greatest trade was buying greenback bonds during the Civil War and into the panic of 1869. Some painted it as she never lost faith in America’s potential, but from a practical standpoint, she could see that the North was the industrial hub against the South which was agricultural. Others claim she just ignored the herd mentality and took advantage of financial panics and crises.

Indeed, during the civil war, Hatty bought federal bonds when the greenback would collapse against gold. In 1862, the greenback declined against gold until the end of the year when gold was trading at a 29% premium to the paper greenbacks. The following year, by spring of 1863, the greenback collapsed to $152 against $100 in gold. After the Gettysburg victory, the greenback bounced back to $131 to $100 in gold. Then came 1864 when General Grant was making very little headway against General Lee. When it looked bleak in 1864, that is when the Greenback collapsed to its lowest point reaching during July 1864 briefly to $258 greenbacks to $100 in gold.

The Greenback began to recover, dropping back to the $1509 level. Congress limited the total issue of greenbacks to $450 million, which helped to support their value. Then the Panic of 1869 hit, and Greenbacks fell again to $162.50. Hetty made a fortune buying the Greenbacks at the lows. Then in December 1878, Congress made the Greenbacks on par with gold. What bonds in Greenbacks she was buying, she gained not just the interest but also about doubled her money on this trade alone.

Therefore, Hetty bought railroads, real estate, and bonds. She could smell blood in the streets, as they say in financial markets, and she was there to buy it up. Men mocked her, and women scoffed at her frugal ways. Nevertheless, she had thick skin, and because she would buy in the panics and win, they called her the “Witch of Wall Street.” Yet, she even supplied the loans that kept the city of New York itself from going bankrupt. Even when the markets panicked, Hetty looked at the trend and had a nose for seeing the market. She would be there lending money at 25%.

Hetty is said to have relished a challenge. When her aunt died and did not leave Hetty the fortune she expected, she filed a groundbreaking lawsuit that still resonates in law schools and courts. When her husband defied her and sank her money on his own risky interests, she threw him out and, marching down to Wall Street, quickly making up the loss. Her independence, outspokenness, and disdain for the upper crust earned her a reputation for harshness that endured for decades.  Yet, those who knew her admired her warmth, her wisdom, and her wit.

When Hetty died, she did leave a fortune.

Her son, Edward Howland Robinson Green (1868-1936), was not so frugal. He was an avid collector and bought the famous sheet of 100 inverted air mail stamps in 1918, paying $20,000. The last example sold after a few years and brought in $1.3 million. He also had bought all five of the known 1913 Liberty Head nickels and as many as seven of the rare 1838-O half dollars. He also held dozens of high-grade 1796 quarters.

Mar 14 2021

Pi Day is Here


Armstrong Economics Blog/ECM Re-Posted Mar 14, 2021 by Martin Armstrong

COMMENT: Marty, Happy Pi Day. This was your destiny since you grew up in a house numbered 314.

Cheers

HB

REPLY: Perhaps you are right. I never thought about Pi until I was trying to figure out how the model would work precisely at times to the very day as it did in 1987. I was dumbfounded. I had thought the 8.6 was just an average. I had no idea that it was a derivative of Pi – 8.615384615. But that is the way research should be conducted. I never began with a theory I was trying to prove and thus only looked for supporting data. I think all the great discoveries in human history are by accident.

I am working right now on The Geometry of Time. I am covering all the various people who have pondered even what is TIME from Aristotle to Richard Feynman and his proposition that antimatter is matter moving backward in TIME. I am trying to cover all the various methods over the centuries that many have looked at exploring TIME. I believe that cyclical analysis is the best way to ascertain a glimpse of TIME and the state of the future.

I am working hard to get this next book The Geometry of Time out and its companion the Discovery of the Business Cycle – The Economic Confidence Model.

Feb 23 2021

The Shift from Public to Private on You Tube


Armstrong Economics Blog/ECM Re-Posted Feb 23, 2021 by Martin Armstrong

Oct 18 2020

The Discovery in Volterra


Armstrong Economics Blog/Ancient History Re-Posted Oct 18, 2020 by Martin Armstrong

In Tuscany, Italy, a major discovery has been made of the only amphitheater to have been discovered that was never excavated before. This is being called the “Archaeological Discovery of the Century,” for everything else has been cleared over by people for centuries. The location is the ancient Italian city of  Volterra, which was once part of the Etruscan culture dating back to the 8th century BC that was eventually conquered by Rome. The coinage of Volterra was cast bronze clearly showing that the monetary system dated back to the Bronze Age when the Minoan culture was the great empire prior to 1650 BC and the eruption of Thera known today as Santorini.

The archaeological discovery is very important. It will be most interesting to see what comes out of this site, but then again, they are using COVID to crush society for the real end goal of climate change.

Oct 3 2020

Astronomical Phenomenon & Socrates


Re-Posted Oct 2, 2020 by Martin Armstrong

QUESTION: Hi Martin,
Thank you so much for sharing the connections Socrates is making between seemingly unrelated ideas. I’m a high school/collegiate science teacher and am wondering if Socrates has identified any correlations between coming astronomical phenomenon (like lunar phases or planetary alignment) to war or the economy. The information you’ve provided on the Sun has been amazing!
BTW, my students and I use the information you blog about as the foundation for the conversations in our Socratic seminars.
Thanks for all you do!
MC

ANSWER: I have never input the planetary information into Socrates. The Moon is capable of picking up the ocean and moving it creating a high and low tide. I would think it can have some influence on people but probably highly differential because we are all perhaps sensitive to various things on an unequal basis. The terms “lunatic” and stories of werewolves are all about people who were sensitive to the moon.

The attempt to correlate the heavens and events on earth as omens of the future date back to the Babylonians. I have been asked this question many times because some of our dates may align with some astronomical phenomena. I would look at it as a separate model. Our Arrays have some 72 different models. They are not a single cycle. There are many. Even take volatility. How do you define it? We have overnight volatility from today’s close to tomorrow’s open. Then there is internal volatility which is the percentage movement between high and low for the day. Then there can be closing volatility measured from yesterday’s close to today and likewise between openings. There are many aspects that the computer is looking at and then it correlates between markets, countries, etc. There are far too many calculations for any individual to do every day.

After my experience with cycles, they go through inversion processes where the same targets remain fixed, but instead of a low, it becomes a high. I would suspect that attempts to use astronomical phenomena will result in the same outcome. The same event will not always produce a high or low. This simply takes place because every market is influenced by everything else around it. It really takes a supercomputer to work out the countless possibilities.

That is why I say my opinion is just personal. Anytime I have thought something would happen which Socrates has disagreed with, I am the one who is wrong. So I have learned. My job is to provide some clarity, but it is not to forecast the future from a personal opinion perspective. Forecasting Civil Unrest was not something that came to me in the middle of the night. It is not even something I personally would have preferred to see.

And BTW, I have been a programmer all my life. I do not see how it is possible for a program to EVER become aware of itself and then dominate humanity. I can mimic human emotion, but I cannot create it for real. And to set the record straight, I have been the ONLY coder on the AI systems behind Socrates. This has been my life’s work. We have a whole team of programmers who manage the delivery systems. But as for the AI, in all honesty, I had the skill to program, I also had the skill to trade, but I also had the clients to show me with a front-row seat how they all look at the world economy from their own perspective. That is why there is no competition for Socrates. It has taken over 50 years to create what you see.

It is also why nobody wants to address Socrates because it changes the entire forecasting game where people advise they are the guy who forecasts some event so see what he is saying next. Personal forecasting is not consistent.

Sep 28 2020

Capital Flows Will Be the Key


Armstrong Economics Blog/Economics

Re-Posted Sep 27, 2020 by Martin Armstrong

QUESTION: Mr. Armstrong,
If this “Great Reset” movement pushes gold underground, what kind of a future do we really have?

HR

ANSWER: On election night, Trump should win. However, the real question will be the mail-in ballots, and are they legitimate. As I have said, it really does not matter who wins from the perspective of the model warning that we will see a rise in civil unrest. NEITHER side will accept a loss. As I have said before, if the guy you voted for lost, it was no big deal, you went on with your life. Obama may have said all kinds of nonsense against Bush from Quantanamo was illegal to his authorization of tapping into US phones. But at the end of the day, Quantanomo was still there when Obama left and the surveillance only increased under Obama. The DEEP STATE runs the show and the trend never really changed.

If you look to France, they imposed a 10% tax on gold. I have friends there you buy their gold but post it to Belgium. We have to understand that is far beyond simply Republican v Democrat. Those are the old days. These people are really trying to seize control of the world to push their agenda of POPULATION CONTROL and CLIMATE CHANGE.

There is no way they will achieve their goal. This is wildly naive and it requires an academic to come up with this nonsense. There are two things that they have completely gotten wrong and it seems willing. (1) Climate Change and (2) the Business Cycle. Civilization expands with warming periods and contracts during cold periods. To listen to these people who argue that climate change is caused by humans cannot be supported by the data. We certainly do not want to live in pollution. We need clean air and clear water. But pollution does not change the climate. There are far bigger cycles at work.

Insofar as the business cycle is concerned, this is driven also by weather as well as innovation. The idea that we can create an economy that is the perfect utopia where there is never a recession or depression is absolute nonsense. Just look at any market from stocks and bonds to commodities. Everything fluctuates.

These two assertions that they can manipulate the climate and smooth the business cycle to create the perfect world is the dreams of madmen who are not satisfied with the way things actually work in this universe.

The BOTTOM LINE will be capital flows. What we must be concerned about is that there will be capital restraints imposed in different countries. Cutting off international travel is highly dangerous. The USA is no exception. All my staff outside the country cannot visit for everyone’s visa has been canceled. In Europe, Americans will be prohibited from traveling there without preapproval BEFORE you can even buy a ticket starting in 2021 and that was before COVID. We are staring at a deliberate move to reduce air travel as part of this Climate Change agenda without formally stating so.

This is no longer about Republic/Conservative v Democrat/Labour. There is a much bigger agenda taking place which will dictate the direction of the world economy ahead of us.

Sep 25 2020

Teaching Children to Think


Armstrong Economics Blog/Education

Re-Posted Sep 25, 2020 by Martin Armstrong

QUESTION: Hi Martin,
Thank you so much for sharing the connections Socrates is making between seemingly unrelated ideas. I’m a high school/collegiate science teacher and am wondering if Socrates has identified any correlations between coming astronomical phenomenon (like lunar phases or planetary alignment) to war or the economy. The information you’ve provided on the Sun has been amazing!
BTW, my students and I use the information you blog about as the foundation for the conversations in our Socratic seminars.
Thanks for all you do!
MC

REPLY: I have not used astrology even though my understanding has been that it was devised by the Babylonians who sought to correlate events on earth to events in the heavens, as well as the movements of the earth and animals. I am not so certain that specific events in the markets can be forecast by that method because things change and there are more complexities involved today. Nevertheless, they may align with what I have to say from time to time. The cycle of the sun 300 years aligned with our 309.6-year cycle. It is interesting that these solar cycles are getting weaker. The climate change that appears to be on the horizon is not global warming, but global cooling.

There is no discussion of even how the poles flip. I worked out the cycles on that from the data that was sent to us to see what Socrates would come up with. It turned out to be a 720,000-year cycle, so unfortunately we do not have an account of what took place the last time. Nonetheless, we are in line for that change perhaps post-2032. The poles flip every 11 years on the Sun. But, nobody lives there to explain the impact. There is no discussion of the sun cycle nor the movement of the poles in this climate change scenario they put forth where they claim we will all die after 7 years.

I am thrilled that you are teaching your students how to think. I really wish more teachers stopped the brainwashing and open their own eyes to the agenda being forced upon the youth for nefarious purposes.

Sep 15 2020

Waging War Economically


Armstrong Economics Blog/Economics

Re-Posted Sep 15, 2020 by Martin Armstrong

QUESTION: Hi Marty I so miss the WEC conferences. Can you comment on ECONOMIC WAR in historical perspective. In early 2000s I heard that wars will no longer be fought with guns but instead will be faught with economics, are there examples of using economics in history that correlate to the present and the decline of the west and rise of the east? There was a book titled “all the monies of the world” by franz Pick and the line I remember from it was “the destiny of a currency is, and always will be the destiny of a nation” always wishing you the best and I am very thankful to have met you in Orlando

DM Ohio

ANSWER: There have been frequent attempts to fight wars economically. The Germans were counterfeiting the British five-pound notes to undermine their economy. During the American Revolution, the English were counterfeiting the Continental Currency also to undermine the economy. This is standard since the invention of paper money.

In ancient times, the counterfeiting was private. There was no strategy to use counterfeits to undermine an adversary. In the case of the siege of Athens in 404 BC by Sparta, they simply cut off their supply of silver to undermine their ability to fund the war.

This time around, moving to a digital currency opens the door much wider to undermining the banking system itself as a tactic to wage war.

Aug 18 2020

Kondratieff Wave – COVID – Future


Armstrong Economics Blog/Economics

Re-Posted Aug 18, 2020 by Martin Armstrong

QUESTION: Hello Mr. Armstrong,
I would first like to thank you for your work on the public and private blogs so we small investors can understand the greater trend that has been building for quite some time.
I also hope that your health conditions have gotten better and that you are recovering.
Your work has deeply shifted my view from the university education that I have just now finished; ideological stances are everywhere.
However, I am confused about a subject that is not an economic one -COVID.

Regardless of the political motives being used with this virus to create the premises of a “new” socialist revolution (political Economy); this virus has come right around the 2020 solar minimum so are we to expect this virus to continue in some way shape or form (Mutate or another virus)?

Furthermore, what guidance would you give to the next generation (West), those coming in this new cycle of China’s undeniable Empire now facing inward in building their domestic economy?
We are seeing all the hallmarks of the end of the Western Empire’s absolute reign with crippling doomsayers, more broadly the cultural landscape of the West (Climate Change, Equality against Freedom)?

You have said that we will see a rise in the commodity cycle, is the commodity cycle synched with the Kondratieff wave of the new Energy being needed to create this new future.
Are these rare minerals part of the bigger trend?

The ground is moving but as Churchill once said we must “Never let a good crisis go to waste”

Thank you for reading this entirely, I hope you all the best
Sincerely
RLB

ANSWER: The Kondratieff Wave has been seriously abused over the years. Look at the economic structure from when he constructed that data for the wave. Commodities were 70% of the economy during the mid-19th century, falling to about 40% by 1900, and eventually 3% by 1980. This is why the Kondratieff Wave failed to work as people were predicting. The next ideal turning point will be 2028.

If I constructed a cycle based on the snapshot of the economy today, 70% would be the service industry. But things change with time so the model must also adapt to the changing structure of the economy. Additionally, there were waves of innovation pointed out by Schumpeter, but even this still missed the underlying causes. Prices certainly soared during the war, for this is when food production was also disrupted. Make no mistake about it, this COVID scare has reduced food production precisely as what unfolds during a war.

Even this still fails to dig deep enough. This was also a solar minimum. We were gradually coming out of the Little Ice Age and it was still cold into 1850. Therefore, the rise in warming was been a dead-cat bounce. Consequently, we are still in a position where we are vulnerable to a decline in solar activity, which is already reducing food production. Shortages will be seen in North Korea which will incentivize an invasion of the South if they see the USA becoming divided and weak. We also see crop failure in China. The rise in prices will be from SHORTAGES, not speculative demand.

Even if we assume that this virus was manmade, that does not prevent it from mutating. The common cold is a coronavirus and we cannot cure that. This will most likely mutate for years to come. That does not mean we should be locked down with masks for the rest of our lives.

As far as guidance is concerned, first, forget European languages and start studying Mandarin. As far as skills, look to technology. Programming will be critical, for it teaches you what is possible in this new age of artificial intelligence.

Aug 15 2020

Left – Right – Middle – Inevitable


Armstrong Economics Blog/Politics

re-Posted Aug 14, 2020 by Martin Armstrong

QUESTION: Do you think the Republicans are any better than the Democrats in Washington?

SP

ANSWER: All career politicians are a problem for they lack contact with the people. Longer-term, this form of government I seriously doubt will last. This is the very same problem of corruption that infected the Roman Republic which ended in the civil war and then Imperial Rome began. If you look at Athens, there was a constant battle between the oligarchy and those who were Democrats. Representative government has never been sustainable because politicians can be bribed.

The crisis with the Democrats is confined to the leadership which is pandering to the extreme left. My father was a Democrat. Not all Democrats are evil. The vast majority are not extreme left which will make this election very interesting. Then about 10% of the people are truly independent and will swing back and forth. The middle ground Democrats and Republicans have always worked together. But make no mistake about it, all career politicians of both parties are protective and do not like outsiders. They did not like Ronald Reagan at first because he was only a governor. Note that they picked Harris for VP not that she is qualified, but that (1) she is part black, (2) a woman, and (3) a Senator so she is in the game.

All Republics die from oligarchies and become infested with corruption. They hated Trump before he even took office BECAUSE he was not one of them regardless of his comments. It has always been a closed club. My father as a lawyer who defended a client against Republican U.S. Senator Joseph McCarthy in his hearings.

Had the Supreme Court simply ruled honestly that Equal Protection is not limited to race, creed, or gender, but also class, we would not have this Marxist struggle. If you bad mouth a minority it is hate speech. If you bad mouth someone who has more than the average in material wealth you are exposing an injustice. If the Supreme Court simply upheld the constitution which makes no exception based upon any grounds, we would not have this clash between the parties and reduce the class warfare which ALWAYS leads to the collapse of every Republic in history.