Armstrong Economics Blog/The Hunt for Taxes Re-Posted Apr 23, 2021 by Martin Armstrong

COMMENT: Mr. Armstrong, a close friend of my is a major celebrity in Hollywood. They too follow you and are joining the exodus from California. So many people are leaving it is remarkable. It looks like the buyers of these expensive homes are foreigners, mainly Chinese, who want the prestige of Hollywood but are exempt from the income taxes.

Just thought you might want to know.

Thanks for being a light in a new age of darkness.

HC

REPLY: Yes, the press seems to be filled with an endless stream of celebs selling their homes in California. I suppose they are all not leftists, or at least they are leftists only in rhetoric, but for themselves, they are more right. I suppose their destination is Texas or Florida.

What is really fascinating is that the great California Gold Rush (1848–1855) was a gold rush that began on January 24, 1848, when gold was found by James W. Marshall at Sutter’s Mill in Coloma, California. The mad rush really began in 1849 and that is when the US began minting California gold into coins. The news of gold brought approximately 300,000 people to California from the rest of the United States and overseas. If we look at 1848 and 2020, that is exactly 172 years or (2 x 8.6 = 17.2). The mad rush out of California is precisely in line. In fact, it was 1849 when Californians sought statehood. That was finally granted and California entered the Union as a free, nonslave state by the Compromise of 1850. California became the 31st state on September 9, 1850

Between 1849 and 1853, about 24,000 young Chinese men immigrated to California. Chinese immigrants soon found that many Californians did not welcome them. In 1852, California placed a high monthly tax on all foreign miners. Chinese miners had no choice but to pay this tax if they wanted to mine for gold in California. California has had a history of punishing people they do not like with burdensome taxation. Interestingly, 172 years from their punitive Chinese taxation will be precisely 2024. It does not look very good for California by 2024. They will realize they have lost their best people like “Atlas Shrugged.”

Armstrong Economics Blog/Real Estate Re-Posted Apr 23, 2021 by Martin Armstrong

QUESTION: Marty, at the Orlando WEC, I asked you if your real estate forecasts for residential included condos. I believe you said no. I bought a house when your index elected a monthly bullish reversal in June 2020. Everything seems to have doubled since. Do you think your forecast into 2023 is influenced by the excessive spending of Biden?

Thank you.

KW

ANSWER: Yes, this is the single-family home index. It does not include commercial real estate or condos. It is always a combination of influences. It appears that Biden has provided the straw that broke the back of deflation. Central banks have been engaging in Quantitative Easing since 2008 without success. This has been largely caused by the collapse in confidence in the future. When people fear the future, they save. Increasing the money supply does nothing until the people decide to spend it.

One of the factors that confirmed to me that we would be heading into progressive inflation long-term was the fact that this Residential Index elected a Yearly Bullish Reversal at the end of 2012. That confirmed the long-term trend had changed. However, urban condo and commercial properties were forming a divergence. I assumed that was being caused by the debt and rising taxes in cities. In that regard, I suppose I was only partially correct, for the rest has been the brain-dead response to COVID.

For example, locking people down and causing them to lose jobs has resulted in a sharp rise in violence. Not just mass shootings, but all sorts of conflicts from domestic disputes to outright feuds. Cities, such as Philadelphia and New York, have sections in which the police have totally lost control. It is debatable if they will ever be able to restore civility to these regions. While Fauci claims to ignore the Constitutional violations, his agenda in helping Gates and Schwab is more than simply preparing society for the Great Reset. He is furthering the collapse of urban civility and this trend is part of what is driving this index.

I would expect to see this escalate and if we make a new high on this index and close above last year’s high, single-family homes outside of urban centers will rise sharply into 2023.

Armstrong Economics Blog/Basic Concepts Re-Posted Apr 21, 2021 by Martin Armstrong

QUESTION: Hi Marty,

hope your are doing well.

I have some question regarding trading to you.

Why is this game mentally and physically so hard to learn… normally every trade has a 50:50 chance but if I enter the market everything is going „different“. Just trade against me and you will become even much richer, its crazy!

I think my biggest mistake is to enter a trade way too early … when I read the market could turn (maybe in 2 weeks) my reaction was /is „going short immediately“ – its just so dumb – but that is what brought me the heaviest losses this year. Shorted the DOW from the 30k level again and again.

Socrates is like a market navigation – I know that – and when the navy says right I drove left – always in fear the market could crash like last February.

…

maybe you can wright a bit more on your blog – what were your easiest secrets to become a successful trader. maybe a sample account which etf´s / stocks are promising for the rest of 2021 or some live trading sessions via chat on your socrates platform.

…

Sorry for disturbing you again and again – but I know you are the only man who really know how this game works and you might understand my „little“ problems. BTW: nice call for the top in Bitcoin !!!

THANK YOU

Have a good day and best wishes.

O

ANSWER: The most common problems in trading have been (1) over-trading and (2) anticipation.

Many think they are limiting their risk by trading too frequently. They do not want to risk, say $100, so they continually anticipate a trade and lose $20 ten times in a row. The real secret to trading is recognizing that your opponent is really yourself.

The problem with systems that require human judgment is that they expose your human frailties. Whether it is looking at technical patterns, candlesticks, or wave patterns, all of these forms of analysis require experience and whether you have a natural tendency to be artistic. Those who have an artistic eye can see patterns easier than those that do not. They will see a face in a cloud shape, but others will say they are nuts as it’s just a cloud.

The key is to try to eliminate that human judgment as much as possible. You only need to look at the setup when the price is reached, but during the time target. The monthly Array pinpointed April since the start of this year. Then you look at the Weekly, and it targeted last week with a Directional Change and higher volatility starting this week. Then look at the Daily level. This way, you are not looking at patterns yourself and acting on a hunch. Even the Global Market Watch came up with April as a possible important high, and that is just a pattern recognition model.

With every trade, you must always define where you are RIGHT and when you are WRONG. There are no DEPENDS once you put on a trade. We only have a DEPEND in the setup. Did it reach the time and the price? Other than that, once you are in, some people hate to take the loss because it is acknowledging they were wrong. If you have the setup, then selling against the high on that target week or day with a stop above that high makes sense, and it is a lower risk. If you think it will crash, so you keep selling on a hunch, you will lose.

Consequently, people who are into gold and just blame others because gold has not rallied as they expected are simply people who will never learn how to trade. Mistakes are important. We pay dearly for them, so pay attention. That is how we learn and advance in life. Every parent tells their child not to stick their finger in the flame of a candle. We all do. We have to learn for ourselves.

Remember, you are your real opponent. So make peace with yourself. Come to a truce.