Tag Archives: BREXIT

Nov 11 2018

France – Macron’s Popularity in a Free-Fall


Armstrong Economics Blog/France

Re-Posted Nov 11, 2018 by Martin Armstrong

In France, things are not much better. Emmanuel Macron, the current president of the French Republic, has collapsed in popularity from 57% to just starting to break the 30% level. Macron has collapsed in popularity faster than Nicolas Sarkozy did, who was a one-term president. Macron said he wanted to turn France into the “Start-up nation” but really promised the same old traditional political agenda. Many are becoming concerned in France also about the massive immigration. Many French are calling it a Trojan Horse, for now, one-third of all births in France are from non-European.

The problem with all the immigration has been that they dropped all requirements for some sort of skill. This is why many on the legal immigrants in Britain voted for BREXIT for they had had to have the work skill to get in like a doctor or nurse. Trump carried Florida and the Mexican vote for the same reason. So many had to prove they had a skill and go through the Green Card process for years to get in. Nobody is considering the sacrifices others made to migrate. Even the great 19th-century migration from Europe to America, there were no free handouts. They came for the opportunity to work – not a free meal

Nov 10 2018

Kennedy – Roosevelt & Corruption?


Armstrong Economics Blog/Corruption

Re-Posted Nov 10, 2018 by Martin Armstrong

QUESTION: Mr. Armstrong; I had always heard that Kennedy made a fortune on Scotch. My question is, where they booze runners during the Prohibition?

Thank you

GR

ANSWER: No. But they actually used Roosevelt to secure that lucrative import trade of Scotch – my favorite drink. Joe Kennedy traveled to London in 1934 on the steam-driven ocean liner, the SS Europa. While he brought his wife with him he also brought James Roosevelt (1907 – 1991), the American president’s oldest son. The trip was portrayed as a please vacation, but bringing the President’s son was the clear signal it was not a vacation.

Kennedy’s main prize would be to gain the British rights to send Scotch whiskey, gin, and other imported liquors. He knew based upon inside information that Prohibition would be ended. Joe brought the president’s 25-year-old son to help organize a private visit with Winston Churchill.  He used Roosevelt’s son to get that contract. The deal paid off and Joe got the private meeting with Churchill and visited him at Churchill’s Chartwell home.

So you see, political inside favors have been going on a very long time. James Roosevelt was closely linked with Joseph P. Kennedy Sr. Many of James Roosevelt’s controversial business ventures were indeed aided by Kennedy. Jame’s dealings were often clouded. In fact, Treasury Secretary Henry Morgenthau even threatened to resign unless FDR forced James to leave a questionable company which became known as the National Grain Yeast Corp. affair (1933–35), which was believed to be just a front for bootlegging. It was James Roosevelt who lobbied his father to make Kennedy the ambassador to the United Kingdom.

James was a shading type of character in the eyes of many. Later on, during July 1938, there were allegations that he had used his political position to steer lucrative business to his insurance firm. He was then forced to publish his income tax returns and denied these allegations in an NBC broadcast and an interview in Collier’s magazine. This became known as the Jimmy’s Got It affair after Alva Johnston’s reportage in the Saturday Evening Post. Roosevelt resigned from his White House position in November 1938. The press was often highlighting how rich Jimmy was becoming when his father was a Socialist

Nov 8 2018

May 2019 European Parliament Election Looking for Major Upset


Armstrong Economics Blog/European Union

Re-Posted Nov 8, 2018 by Martin Armstrong

The French Revolution is still alive and well. In France, French President Emmanuel Macron’s abysmal approval ratings have simply continued to collapse. He has suffered as the French have reviewed his elitist lifestyle mixed with his attempts to reform union and then throw in his controversial immigration policies. Many now believe he will collapse to under an approval rating of 10% perhaps matching his predecessor the socialist Francois Hollande, who was so unpopular, he didn’t even bother to attempt a second term.

Now, the National Rally (formerly National Front) party’s candidates for the May European Parliament election are beating Macron in the polls. This is the first time the far-right party has overtaken Macron’s centrist movement in the polls which is a mirror of events in Germany with the rise of the AfD. The May elections coming in 2019 appear to be headed to another major political blow for the EU. Macron’s “En Marche” ticket is failing as is the case for Merkel in Germany.

Nov 8 2018

Bundesbank warns of Coming Pension Crisis


Armstrong Economics Blog/Pension Crisis

Re-Posted Nov 8, 2018 by Martin Armstrong

The Bundesbank has come out warning that there is a German pension crisis. They have proposed that states raise the pension tax and that they should gradually increase the retirement age because the life
expectancy in the future has risen. Central Bank President, Jens Weidmann, has stated that he is generally in favor of raising the statutory retirement age beyond 67 years.

We must understand that the ECB policy of “stimulating” the economy with negative interest rates has bankrupted state pension plans. This theory that lowering interest rates to get people to borrow and thus manipulate demand higher has NEVER been proven to have ever worked. The consequence of what we now face is a major pension crisis that is undermining the future of Western economies

Nov 7 2018

Gold & Bitcoin


Armstrong Economics Blog/Cryptocurrency

Re-Posted Nov 7, 2018 by Martin Armstrong

 

QUESTION: Mr. Armstrong; I really encountered an insane goldbug who claimed you were paid off by the gold cartel to keep the price down. These people cannot open their eyes and see anything but gold or bitcoin. Then they argue the age of knowledge and bitcoin will become the new reserve currency. You really have to wonder if these people are on drugs. Will you be doing a gold report soon? Is it still a viable option for some portion of wealth in the future. Bitcoin seems to depend entirely upon a power grid. I was traveling back to the States and was actually asked if I had cryptocurrency. I said no. What is all that about?

IK

ANSWER: Yes we will be doing a gold report soon. Yes, these people are insane. Why would the gold cartel want to suppress gold prices? They claim to force people to sell their gold at cheap prices. But the annual production of new gold is about 3150 tons as of 2017. There are 32,150.75 troy ounces per metric ton. That means the annual production during 2017 was 101,274,862.5 troy ounces. That is a lot of new gold coming to the market every year. That is far more than small investors would be dumping. You really think they would suppress the gold price to force small investors to sell say even 10 million ounces when they mine more than 100 million annually? That is really just sophistry and it is a shame people would even believe such nonsense.

I really cannot imagine that any government would surrender power to Bitcoin. Come on. Spain is criminally prosecuting Catalonia politicians for simply advocating a democratic vote to separate from Spain. But governments will surrender their power to Bitcoin? The dollar is not even the RESERVE CURRENCY by choice. The USA has been trying to encourage competition and advocated the creation of the Euro back at the Plaza Accord in 1985. The USA always wants a cheaper dollar to sell more goods overseas to create in theory domestic jobs. Even Trump advocates that position of a cheaper dollar. Only a fool would believe that governments will lay down their power simply because you ask them to. Open any history book. Power shifts NEVER come involving government without major uprisings. Sorry, they will NEVER sit on their hand and watch their power evaporate. They will only surrender power during revolutions for they will kick and scream every step of the way.

As far as cryptocurrency declarations, they are beginning to look at anything that they can confiscate that is more than $10,000 when traveling calling it all cash. Italy confiscated bonds a man had in a briefcase on his way to Switzerland. It was not “cash” but they are calling anything that can be converted or sold as “cash” because they are desperate. I wrote about those proposed regulations last year.

During August, gold fell to 1162.70 intraday. The channel support rests at 1144.03. Gold open interest is about 488,000 contracts which amount to almost $600 million. That compares to the production in 2017 valued at $121.5 billion. The total market capitalization of the US share market alone is about $30 trillion. The US National Debt is about $20 trillion. Total world sovereign debt is closer to $250 trillion. Gold is simply not a big enough market to displace everything of value out there. It is one component that will rise in value. But gold will NEVER replace the dollar and governments will NEVER return to any commodity standard.

The true wealth of every nation is its people and their productive capacity. China, Japan, and Germany, all rose to be major economies with no gold reserves. Russia, which had all the resources, moved from communism to an oligarchy and that prevented its economy from exploding as was the case in China. All the gold, diamonds, and oil, did not propel Russia to #2 economy. It is the people that create wealth – not merely resources. Forget returning to any commodity based currency. It does not work any more than austerity works in Europe.

Nov 6 2018

Europe Unemployment at 8.1% – The Economic Death Spiral of the EU


Armstrong Economics Blog/European Union

Re-Posted Nov 6, 2018 by Martin Armstrong

 

The latest data from Euro Stat for September 2018 demonstrates the complete failure of the ECB and its Quantitative Easing. The Euro area (EA19) seasonally-adjusted unemployment rate came in at 8.1% in September 2018, which was down slightly from the year/year perspective of about 8.9%. This above all proves that the entire theory of the Quantity of Money is bogus. It also demonstrates that the Austerity Policy of Europe has caused unbelievable social damage resulting in what is being called the Lost Generation with unemployment among the youth reach 60% in Southern Europe.

Without a COMPLETE rejection of Austerity and a COMPLETE overhaul of the European Union structure, there is absolutely NO HOPE what so ever of Europe coming out of the death spiral. This will only get worse as politicians, with ZERO experience in trading markets, will debate and refuse to accept responsibility for their actions. Then you opened the doors to refugees when unemployment is at a serious high? And you wonder why there will be civil unrest and backlash against migrants?

As Einstein pointed out, you cannot possibly solve our problems with the very same thinking process that was used to create them

Nov 5 2018

The Fate of Germany v Euro – The Export Economic Model Risks


Armstrong Economics Blog/Economics

Re-Posted Nov 5, 2018 by Martin Armstrong

QUESTION: Mr. Armstrong; I watched the new documentary on your solution. I really want to thank you for everything you do and for free. It is so nice to see someone who actually gives back and has no personal agenda to enrich themselves. My question is this. You mentioned the reason why the United States economy was the envy of the world and differentiated it from Germany which has an export model economy that is why they supported the euro, to begin with. What do you see for Germany ahead?

Thank you

CB

ANSWER: Germany has an export-dependent economy which has directly benefited from the continent-wide trade liberalization and the creation of the Euro which eliminated foreign exchange fluctuations for German manufacturers in Europe at least. However, that simply means that Germany also has the most to lose from a worsening Euro crisis and a resulting wave of Euroscepticism. The political freedoms lost with the creation of the Euro will tear Europe apart. The refusal to consolidate the debt within Europe was profound. The Italy Crisis demonstrates what I have been warning about. BECAUSE there is no central debt, Brussels sticks its nose into every budget of every member state. The economic conditions within Europe are different between each member. Germany is an export economy and Greece is a tourist economy. There are great differences between each member so one policy does not fit all.

They are trying to PRETEND they are creating the United States of Europe but that is a joke. The refusal to have consolidated the debts created an unsustainable political union. The USA has a federal debt and budget. Washington does not stick its nose into the budgets of all 50 states. They issue their own debt which is NOT ACCEPTABLE for reserves of any bank. They are also all on their own paying different rates of interest according to their credit rating. In the EU, they are trying to manage the budgets of every member which will only lead to political differences. The structure is absurd and then the banks have to be politically correct and hold the debt of all member states. Thus, the risk becomes if one member is in a crisis, they bring down the entire system. In the USA, if Illinois goes bankrupt, it has no impact on the dollar, the national debt, or politics in Washington.

The greatest risk to Germany is the collapse of the Euro means that the single currency relieved their manufacturers of having to manage currency risk. Suddenly, the currency risk returns, the export model fails, and the lack of a domestic consumer market means that the economic conditions in Germany decline rapidly because of their dependence upon everyone else doing well.

Nov 5 2018

Goldman Sachs – Criminal Charges at Last?


Armstrong Economics Blog/Corruption

Re-Posted Nov 5, 2018 by Martin Armstrong

The U.S. Justice Department’s charges against individuals related to the pillaging of the Malaysia investment fund known as 1MDB offers several new insights into the global, multibillion-dollar scandal. But there is something the press is overlooking. The senior Goldman Sachs banker in Asia who pleaded guilty to U.S. bribery and money laundering charges and his deputy was arrested in Malaysia, was brought by federal prosecutors in Brooklyn, not the Manhattan Southern District of New York which the bankers own right down to the foundation stones. The Brooklyn prosecutors have laid out conspiracy allegations related to Goldman Sachs’s lucrative fundraising for Malaysian wealth fund 1MDB. The fact that he has already pled guilty means he has a cooperation deal to give up more infor on the inside of Goldman Sachs.

This entire scandal came in right on target in May 2018. It resulted in the political overthrow of the president and the new finance minister discovered computers that even the highest-ranking bureaucrats could not access when they got into the government offices. Computers were set up to prevent access by anyone other than one or two people. Evidence of massive corruption was what turned the election on May 9th, 2018.

I have been writing that ALL my sources from Asia to the Middle East pointed to outright corruption in Malaysia and the deep involvement of Goldman Sachs. I knew dealers who bid on the project and found it went to Goldman when it made no economic sense. The “feeling” in the trading rooms was plain and simple – something was seriously WRONG!!!!

Goldman Sachs’ role, I wrote back in 2015, had been highly criticized in the Malaysian media and political circles after it emerged that 1MDB sovereign wealth fund paid hundreds of millions of dollars to the bank for helping it raise $6.5 billion in three bond deals in 2012 and 2013. Goldman Sachs earned around $590 million in fees plus commissions and expenses from underwriting the bonds, according to Reuters. The reported fees are highly excessive, nearing 10% when such fees are typically only 1% in bond underwriting.

Since May 2018, there was talk about filing suit against Goldman Sachs for its role in this scandal. I warned that filing a lawsuit against them in New York City where they own the courts had little chance of success and Goldman knew that. I had a discussion with a New York lawyer and asked bluntly why the bankers never get changed in Manhattan. The reply with a chuckle was also – “You don’t shit where you eat!”

These criminal charges were not brought by Southern District of New York, but by the prosecutors across the river in Brooklyn.  Donald Trump should launch an investigation against the courts in Manhattan just as Franklin D. Roosevelt did back in 1931 with the Seabury Investigations. The political corruption in New York City is pervasive. The press will not write about it and everything remains hidden. Just perhaps the competition of Brooklyn against Manhattan may open a crack through which some light may appear.

I wrote back in 2015 about this scandal we all knew about behind the curtain. I even wrote that the financial mess even touched the UAE in the mix through IPIC which was established back in the 1980s to focus on energy investments. In 2016 I wrote that the Federal Reserve was preparing an enforcement action against Goldman Sachs related to confidential government information that was leaked from the Fed to one of its bankers. I also wrote that Swiss prosecutors said they were helping the U.S. on the investigation. The Swiss also opened their own criminal proceedings in August 2015, against two former officials of the fund on a string of corruption charges. Their investigation has since been extended to other officials as well.

The question is WHY did the Manhattan prosecutors sit on their hands? Why did it take Brooklyn to bring charges?

 

Nov 5 2018

Spanish Prosecutor Demand 25 Years in Prison for Catalonia Politicians for Advocating Independence


Armstrong Economics Blog/SPAIN

Re-Posted Nov 5, 2018 by Martin Armstrong

The Spanish prosecutor wants to send the politicians of the Catalan independence movement to prison for 25 years. The prosecutor has demanded that the former Deputy Regional President Oriol Junqueras should effectively die in prison. The absurdity of what is going on in Spain reflects that there is no democracy still standing. Dictatorships always call treason anything which seeks to overturn their power. The Catalonia movement was NON-VIOLENT, it was Madrid that has been the violent aggressor.  The prosecutor charged them with rebellion. The Attorney General realizes this will reflect badly on Spain, so he is in favor of replacing the charge of rebellion with the less serious charges of sedition. The mere fact that they would seek criminal charges against political leaders in a non-violent movement that sought a democratic solution is a warning sign that to Spanish independence advocates for this removes any democratic resolution and signals that the only resolution will be another civil war in the future.

The last Spanish Civil War was Jul 17, 1936 – Apr 1, 1939. The beginning of the current movement really started to rise in 1999. We will see this rise as a direct reaction to these criminal charges. The next civil war is Spain may become much more obvious by 2022.

Nov 2 2018

UN’s Global Compact for Safety, Orderly and Regular Migration


Armstrong Economics Blog/Refugees

Re-Posted Nov 2, 2018 by Martin Armstrong

Austria and Hungary have now joined Trump in backing out the United Nations migration deal. The UN’s Global Compact for Safety, Orderly and Regular Migration, which is not actually legally binding on any country lacking jurisdiction or power in the UN over the entire world. This deal was finalized and it is widely seen as pro-migration and unrealistic. The greatest problem with this proposal is that the industrialized nations of Europe and America are in fact SOCIALIST states so migrants get benefits for coming that they would not get at home. The problem is that when mass-migration took place from Europe to America in the 19th century and the first near 50% of the 20th century, that migration was to freedom economically and the opportunity to work. The migration into Europe is by no means of the same quality. They go there with no prospect of employment, understanding or speaking the language, and live far better on state welfare that would possibly have at home. The incentives are completely reversed.

Trump pulled out of that deal and no both Austria and Hungary have joined as they are inundated with migrants who just have their hand out and drain the economy rather than adding to it. The UN’s Global Compact for Safety, Orderly and Regular Migration, is simply unrealistic and fails completely to understand that there is a huge difference between subsidized migration and migration for an opportunity. In the USA, Trump carried Florida with the legal Mexicans voting for Trump because they had to prove they could speak the language and had skills. The same took place in Britain where the Indians voted for BREXIT for most who migrated to Britain also had to have a skill set which was most commonly in the field of medicine. Those in power do not understand that those who learned skills to migrate are now upset at this idea of just opening up the doors under the welfare model. It undermines what they had to go through to make it to a new homeland.