Is the Greatest Trade on the Century Knocking on the Door Yet?


QUESTION: Hello Mr Armstrong
I have been following you now for a couple of years, since the movie the forcaster, it showed me exactly whats is happening in the world and how little I know about finaces and trading. I am a blue collar worker in Canada with a small pension, how can I or where should I go to learn how to trade? Better yet how to use Socrates or someone who can help me or invest for me?
Your work has opened my eyes and also scares the hell out of me for what is coming.
Please can you help me and the other little guys who not as educated?
Thank you

ANSWER: What you want is not to short-term TRADE but to be a position trader. People who try to trade back and forth usually get caught up in emotions and end up losing money. What you want is to POSITION TRADE for the long-haul.  Here is what happens just using the Long-term Reversals only – not even every single one. Sure, you leave some on the table. The important thing is to reduce the number of trades and your confidence will increase and you will actually make more at the end of the day.

Right now, we are still in this consolidation phase, yet this is still a cycle inversion. We have not elected any Monthly Bearish Reversals at all so you just stay with the trade. The exit point keeps rising as the market rises. You can use the Weekly to Exit after a long bullish run. But for now, just hang tight. We may have the greatest trade on the century knocking on the door very soon.

It’s the Inter-connectivity that is the Key


QUESTION: Hello Mr Armstrong,
I read your blog since many years (i live in France) and i’m really impressed by Socrates … You have said that the $ will going to rise against the € and it’s exactly what’s happened !!
You have said that the Dow Jones will rise into 26 000 points and will go on into 40 000 points and the Dow rise since the elction of Trump and we are going to live what Socrates has predicted !!
INCREDIBLE because all the interview and news that i have seen were going to explain that it will be the contrary. Is it the slingshot which is going to happen ? Are we waiting the rise of the Gold before to have the final signal ?
You have always said that the Gold, the $ and the Dow will rise together when the slingshot will begin … are we to this moment ? or is it too early ?
Thanks Mr Armstrong and good things to you and your team.

LB

ANSWER: Absolutely everything is connected. If you get one right, then the rest must follow. It is really impossible to have one market moving opposite of everything else. It is sort of like the world is in a Great Depression and it is impossible for one politician in one country to reverse the trend of the world. So the world economy is very much like a set of dominoes. It is impossible to reverse the trend and it just has to play out. We are not yet ready on the gold. As you can see, gold has been declining in dollars as well as euros. The markets have been consolidating waiting as people are trying to figure out if this the big crash or not. The majority keep calling for the end of times. This has been the MOST hated Bull Market in history. They keep calling for the crash ever since 2009.

Debt Soars, IMF warns


QUESTION: Do you concur with the IMF WARNING?

RKC

ANSWER: The IMF said: “No financial regulatory framework can or should aim to reduce the probability of crisis to zero, so regulators should remain humble.”  What the IMF is warning about is the risk of interest rates rising and countries who have borrowed in dollars are presenting a major Emerging Market Debt Crisis. Then we have the two-fold risk is the currency and the interest rates. Many others have borrowed but with floating rates. Our model is warning that rates are going to more than DOUBLE. In the face of that probability, we are looking at a very distinct and unique type of debt crisis.

Napoleon – War – Sunspots & Human Excitability


COMMENT: I love when you educate us about the weather, especially the cycles. the NAPOLEON story killed me !!! I’m a french and believe me, nobody talked in school about the weather cycles when he tried to fight Russia and lost everything. I read 3 times your chart which plots the temperatures and the cycle initiated by the volcano a few years ago. you are enough smart to guess that French teachers NEVER talk this story under this angle of cooling temperatures…

REPLY: When you correlate everything you see the patterns. Sure, at Waterloo, the French used CANNONS while the British used CANISTERS. On the day of the battle, it rained a lot. The ground was very muddy, soft and wet mud. In that weather and ground conditions, cannons were not as effective.  It was more than just the weapons. In those weather conditions, Napoleon delayed and that cost him the battle. But had the weather been dry, things may have been different. The cold clearly beat Napoleon on his attempted invasion of Russia.

There is also the Human Excitability Study where war was correlated to sunspot activity. The sunspot cycle is roughly every eleven years. However, this time it’s different. The sun is headed for a very rare, super-cooling period that threatens to topple civilization itself as it has throughout history roughly following a 300-year cycle.

For most of its history, science believed the sun’s output was constant. They finally realized that a thermal dynamic cycle beats like your heart so the sun could not exist if it was a steady outflow of energy. One degree less and it would blow itself out. Hence, it is cyclical rising and falling in intensity.

The eleven-year cycle in sunspots itself builds in intensity like the Economic Confidence Model (ECM) reaching “grand maxima” and “grand minima” over the course of 300 years. The last grand maximum peaked circa 1958, after which the sun has been steadily quieting down. Today, the drop in activity is at its steepest in 9,300 years, which is being ignored by the Global Warming propaganda.

The last Maunder Minimum, during which the sun languished for seventy years, took place from 1645 to 1715 when the sun’s brightness declined and the number of sunspots collapsed to almost zero. We are seeing almost zero so far in 2018.

Alexander Leonidovich  Tchijevsky (1897-1964) did a study on sunspot and human activity. He found that humans responded even creating wars with the swings in sunspot activity. He may be most notable for his use of historical research (historiometry) techniques to link the 11-year solar cycle, Earth’s climate and the mass activity of peoples.  Just after World War I, Tchijevsky published a book on cycle theory. Perhaps the title was not destined to make the book a smash hit, but it might take a big breath away before you finish reading the last word. The title was: “Investigation of the Relationship Between the Sunspot Activity and the Course of the Universal Historical Process from the V Century B.C. to the Present Day.”

The title is a bit of a long-winded oddity suggesting that human nature becomes more excited during the increased periods of sunspot activity. Whether or not Tchijevsky proved his theory that we are all driven by sunspots, much in the same manner as the moon drives the tides of the seas is another subject which I am not too certain about. Tchijevsky’s work is an interesting collection of knowledge that does illustrate a pattern within human activity.

Tchijevsky did prove that man became more excited every 11 years which did correspond to the know 11-year cycle of sunspot activity. He gathered data from 72 nations from 500 B.C. to 1922. Throughout the 2,422 years, he included such factors of human excitability as war, riots, revolutions, expeditions, and migrations. He took into consideration the magnitude of the event, the size of the area affected, and the number of people involved. The charts that are reproduced here give a very interesting cyclical view of man’s activity which you can call emotion or excitability.

The Tchijevsky cycle clearly indicates that every 11 year cycle period can be broken down into four distinct periods. Period #1 has a duration of three years which is marked by peace, passiveness, and general rule by minorities. Period #2 has a duration of two years in which general excitability grows from political unrest. New ideas or concepts emerge which tend to challenge the party in controL These ideas become popular answers to present day problems but there is a definite lack of a uniting force. Period #3 again has a duration of three years. Under this period the public’s voice is heard. Under a dictatorship, this has been the strongest period of mass riots and revolutions in which major problems are solved. At times, anarchy does prevail but generally democratic reforms are gained. Period #4 has a duration again of about three years. The general excitability declines, and the people go along contented in a state of apathetic moods. Peace movements usually are generated during this period. The masses prosper and go about their normal course of life awaiting the sun to set and the new light of dawn which brings the beginning of a new cycle.

Reflect for a moment about these four distinct periods. Looking at our own recent political history, we see a similarity between this cycle and our preference towards political parties. For example. we had a cycle of peace and passiveness following World War II culminating in the peak of period #3 during the Johnson term. We entered period #4 bringing in President Nixon as everyone went about their business. Gradually we entered period #1 which brought about the Watergate affair resulting in the Ford administration and period #2 which has a duration of 2 years. Jimmy Carter arrived in town ushering in period #3 which is the peak on the 11-year cycle that normally contains revolution of political unrest. This brought about period #4 when we revolted against the Inflationary policies of the Democrats by voting in President Reagan with a sense of returning back to passiveness and old standards and goals.

Who knows if these events indeed were caused by sunspot activity? Perhaps the sunspots do affect our emotions in much the same manner as the moon can move the ocean from side to side. But the fact that remains is this: a cycle does exist. You can find no century on this chart that was ever lacking such human excitability. We are indeed “only human” to capture a saying normally invoked for human error. We have all heard that history repeats itself. Perhaps it is not history that repeats so much as human error. We are not immortal. We have not lived constantly throughout time. We die and are replaced by new generations. Each generation tends to believe that they are smarter than the last, failing to accurately study the errors made by previous generations; they will make the same mistakes.

Perhaps the events might differ but the result is always the same. Just as the Crusaders charged off to the Middle East to free the holy land from pagan Arabs, as they viewed it, we charged off into Europe to set the world free from the madness of Hitler; both resulted in worldwide wars so the events may have been different but the motives, passions, and outcomes were the same.

Tchijevsky’s attempt to relate man’s excitability to sunspot activity did accomplish one thing significant. His life’s work may not have proved or disproved his sunspot theory, however, it did provide us with evidence that man’s excitability, or emotions as I prefer to call it, moves within a cyclical pattern that can be identified

Bonds & The Record High Short Position Can Majority Be Wrong?


 

QUESTION: Hi Marty,
Can you help us better understand the dynamics of the sovereign debt crisis as it relates to US Treasuries? I know we are in a global debt crisis, which will also impact US Treasuries but it seems like short treasuries is the current consensus (I believe they are currently at the biggest net short position in recent history). Since most people need to be wrong, does this suggest that as global debt unwinds that perhaps US Treasuries may still have another rally in them before the final crash?

Thank you for any insight into what we know to be the greatest bubble.

Looking forward to the WEC!
SB

ANSWER: We have to always look at markets collectively from a global perspective, and also separating the long-term from the short-term trend. It is sort of the saying you can win the battle, but lose the war. This is the same thing. In the case of interest rates, the long-term is clearly staring at higher rates square in the eyes. However, then we have shifts in trend within the short-term. For example, domestically, you have this pervasive hatred of the stock market and as an evergreen tree, they have been perpetually bearish since 2009. They have not wavered in that forecast because they have blinders on and make forecasts solely upon a flat model limited to patterns and domestic analysis at best. Therefore, there will be these bouts of flight to quality sell stocks and buy bonds. We have NOT yet crossed the Rubicon in interest rates. We still have not yet elected the 4th Monthly Bearish Reversal. When we do, the 30-year will signal the debt crisis is in full gear.

Now we have to look at this market from a Hedge Fund Manager’s world. My decision has to be made on a global scale – not domestic. This boils down to you are a prince and your father compels you to ask one of the three ugliest girls in town for a date for political reasons for the realm. So, you choose the prettiest of the three ugly sisters as they say. This is what happens internationally. You have to have money in debt because you are trying to also be diversified (I do not always agree with that strategy). Hence, the euro looks like death warmed over, political chaos is brewing, so you have to push money out the door to other currencies. Hence, the dollar keeps rising and the political rhetoric against Trump is desperate to hide the trend that his strategies have been working on bringing capital home and renegotiating NAFTA. So with the dollar strong, euro in crisis, you have no choice but to buy Treasuries even if for short-term plays.

Consequently, you can be correct that the long-term trend is UP UP AND AWAY for interest rates. However, the devil is lurking behind every rock along the path. You may be correct on the war, but lose a fortune of the short-term corrections. Hence, we have not yet crossed the Rubicon. When we do, it will be time to shout very loud so our readers will hear. We can see that the chart patterns between dollars and euro in the 30-year Treasuries is as different as night and day.

Now We have Caused the Earth to Shift – We Humans Cause Everything


Ok, it is time to all hold hands and jump up and down a few times to set the Earth back in line. The latest is that since 1899, humans are now also causing the Earth’s axis of spin to shift about 34 feet (10.5 meters). Now, research quantifies the reasons why and finds that a third is due to melting ice and rising sea levels, particularly in Greenland—placing the blame on the doorstep of anthropogenic climate change. Another third of the wobble is due to land masses expanding upward as the glaciers retreat and lighten their load. The final portion is the fault of the slow churn of the mantle, the viscous middle layer of the planet. My solution is obvious that we are all to blame and we should begin a program of gradual suicide to save the planet. Those who discovered all this harm humans are doing should set a good example and lead the way for the rest of us to follow. Does anyone want to second that vote?

Solar Minimum Correlates with Volcanoes & Earthquakes


QUESTION: I live in Indonesia. I am amazed that the entire world is not known on your door. I understand that your model puts everything together and provides a whole new perspective. Your warning that here in the Pacific Ring of Fire we should expect a trend of increasing volcanoes and earthquakes has been incredibly accurate. Why do government not listen?

PO

ANSWER: I am deeply sorry that so many people died this week. For those who are not aware, the Mount Soputan volcano in Indonesia erupted on Wednesday, throwing ash as high as 4,000 meters into the sky. This came just days after a major earthquake and tsunami then killed more than 1,400 people on the same island. These things correlate to the solar energy output.

Keep in mind that Solar Minimum does not mean that the sun gets colder but rather it changes. Until it’s not. As sunspots fade away, we enter solar minimum. The sun is heading toward solar minimum now and the sunspot counts are collapsing. While intense activity such as sunspots and solar flares subside during solar minimum, the solar activity changes form. During solar minimum, this is when the sun develops coronal holes. These are vast regions in the sun’s atmosphere where the sun’s magnetic field opens up. This then allows streams of solar particles to escape the sun as the fast solar wind.

These holes throughout the solar cycle during solar minimum can last for a very long time even up to six months or more. Streams of this solar wind flowing from these coronal holes create space weather effects near Earth as they hit our magnetic field. These effects can include temporary disturbances called geomagnetic storms, auroras, and disruptions to communications and navigation systems. These are the effects of solar minimum. These effects in the Earth’s upper atmosphere impacts satellites in low Earth orbit as well. However, on our computer, they also correlate to these periods of an increase in volcanoes and earthquakes.

All I can do is warn from the correlations. I am not presenting a theory as to how they are also causing perhaps geomagnetic disturbance which may go into the Earth itself cause these phenomena. I leave that for specialists to ascertain. Nevertheless, I think this has more influence than driving the kids to practice at school

September the Coldest Month in a Decade – Must be Global Warming


It is not looking very good for the winter ahead. A reader from Calgary sent this picture in about the early snowfall up there. Indeed, Calgary just experienced the Snowiest Day in More Than Three Decades. It Broke an October Snowfall Record. Of course, they will call this Global Warming as well. This is just a taste of this winter to come.

Already, the data is now in for September. The world just had the coldest September for a decade, according to the latest satellite measurements by the University of Alabama at Huntsville.  Naturally, mainstream media will not cover this story. They only like to report how we are destroying the planet and everything is all our fault.

Since the governments have handed out $1 billion for these people to create Global Warming forecasts to justify more taxes, there is not a cold day in hell why they would even give us $5 for a correlation study that shows the opposite. Why fund something that does not produce more taxes?

Well, besides growing food in your basement, perhaps you should buy a sewing machine to make long-underwear to sell to the neighbors when they realize it’s getting colder rather than warmer

Understanding the New Age of Inflation


QUESTION: As an avid reader of your daily BLOG, I’m well aware of the attempt to abolish cash, potential freezing of bank accounts, years of negative or near zero interest rates and “helicopter money” from the government are all likely scenarios in the near to distant future. Without compromising any of your business or proprietary agreements, positions of interest, or ethics, can you suggest or provide some alternatives as to measures to take to avoid this historical “train wreck” we a doomed to experience.
May GOD have mercy on our souls!
BEF

ANSWER: I get a lot of inquiries on this subject. It is much more than I can relate in just a blog post. So I flew to Germany to do another documentary on this subject matter. I believe it will be released in a matter of weeks. I am also putting the finishing touched on a book on inflation and hyperinflation. I am also desperately trying to get this out also before the WEC this November which I hope will put forth a completely new approach to understanding inflation not just for the individual, but to central bankers and politicians as well