QUESTION: Mr. Armstrong; A friend of mine world for the central bank back in the nineties and he gave me a copy of this chart you provided to Italy on your recommendation not to enter the euro on the present terms back then. He said you were the only one with a database and nobody ever saw what the lira looked likely before World War II. Do you have that report you gave to the Italian Central Bank?

JDH

ANSWER: Sorry. I do not have a copy of that report. It was a private issue. The general advice was put out back then in a series of reports we published for our general client base (see Euro). Here is a chart from 1792 to 1999. We can see that the intraday high for the US dollar against the Italian Lira was 1985.

Here is a chart on a closing basis. We can easily see that the US dollar is breaking out and will be making historical new highs against Italy going forward in time.

Now when we ask the computer to extrapolate the Lira from the past and project where the turning points would be in time looking ahead as if it were a single currency, 2018 comes up as a directional change and 2019 in a Panic Cycle. Here are the turning points and we will see this provide the critical points for cracking the euro

Viktor Orban has clearly won the parliamentary elections in Hungary winning 74.6% of the votes on Sunday in Budapest. His party could take 134 seats in the 199-seat parliament giving it a constitutional two-thirds majority. This is an amazing landslide victory for Orban that no American president has ever reached such a majority. The record is 61.05% of the popular vote and that was a sympathy vote for Lydon Johnson after the Kenney Assassination. Even Franklin Roosevelt in 1932 only won 57.41% and Ronald Reagan even beat Roosevelt scoring 58.77%. This puts Orban’s victory at a truly historical level and it is decidedly anti-EU based upon the Refugee Crisis.

After all, it was 1683 when the Turks invaded the Holy Roman Empire and sought to conquer Europe with the Battle of Vienna. That is a historical event that lives on in memory throughout that region. The Muslim invasion crossed from Istanbul through Bulgaria, Serbia, Hungary, to Austria. That event still lives on in the memories of the people in that region that Western Europe does not respect.

Little by little, the European Project is being torn apart all because of the Refugee Crisis that was begun by Markel without ever putting anything to a vote for all of Europe who must suffer simply because Merkel tried to divert her critics from Greece. This has demonstrated that the European Project has been a complete failure. It allowed Merkel to affect all of Europe without any democratic process. The European Project has failed for it has tried to federalize Europe covertly, yet has undermined the political-economic structure necessary to accomplish that goal. The European Project should have remained a trade agreement rather than a political agenda. By trying to force their centralized agenda upon everyone, they are acting no different than any other conqueror.

QUESTION: Mr. Armstrong; I greatly appreciate the mere fact that you cover the Russian markets when nobody does. It is really incredible that your computer can write so much and there is no fear of bias or policial slant. Socrates just wrote, “At this moment, this market is in a downward trend on all our indicators looking at the weekly level.” There has been a panic taking place here with stocks crashing on the news of asset confiscation. You mentioned that your model will predict war correlating all the markets. Is this what is beginning with the crash?

EV

ANSWER: Yes. Here is a chart of the British share market as World War I began. There, the market began to display inherent weakness. It could not get through the top of the channel and as soon as the previous year’s low broke, the market crashed. They then closed the market completely so many people lost all liquidity. We must fear that Europe will do the same. The EU does not like free markets. They have outlawed short government bonds. They are trying to seize the market in the Euro from London because they want to manipulate the currency and will try to prevent a currency crash with the stroke of a pen. Europe remains deeply in danger of a liquidity crisis. If you have money all parked in Europe, you may find it of little use in a crisis.

The immediate crash in Russia was caused by investors in Moscow dumping Russian shares and the ruble following the announcement that the West wanted to confiscate Russian assets abroad. The ruble depreciated by nearly 3% against the dollar. The United States imposed sanctions on Russia for interference in the 2016 US presidential campaign, which is something they do to everyone else from Canada all the way to Russia. Hillary has turned Russia bashing into a national sport. This is clearly leading to a confrontation for the West desperately needs a war to divert attention from the failure of social program promises.

The Russian government will retaliate against the tightened US sanctions. Clearly, the actions of the Congress are unjustified and intended to provoke a confrontation. We are on the path to war and every opportunity to further that goal is clearly being taken by the USA, UK, and the EU.