Tag Archives: centinel2012

Jul 21 2018

Global Temperatures Changes June, 2018, Man Made or Not?


We have been schooled over the past 40 years that Carbon Dioxide (CO2) is rising to levels never seen before on this planet and as a result the world’s average temperature is rising to levels that will, if nothing else, destroy large areas of the planet. The latest UN predictions indicate a major Catastrophe will happen by 2040 unless we do something drastic right now. This destruction will be from two factors; one, ocean levels raising and flooding all worlds coastal areas forcing the world population to higher ground; and two, even if those moves are accomplished the increased temperatures will bring massive storms that will ravage the areas not flooded. The only solution to prevent this from happening is, stop using carbon based fuels; petroleum, natural gas, and coal which, all, generate large amount of water and carbon dioxide and replacing them with wind or solar energy.

These dire projections are based on the belief that CO2 is the “primary” driver of global temperature changes; i.e. more CO2 in the atmosphere is very bad. This view is severally distorted and more likely entirely false.  One can argue the reasons for these lies but it really doesn’t matter whether they are innocent or malicious in their construct; either way promoting something that is tearing up the worlds civilizations by miss allocation of resources is very misguided.

Basic facts:

  • The planets global temperature is directly related to the energy arriving here from our sun
  • That energy manifests itself in a form which we call temperature
  • Temperature is a measure of the amount of heat (energy) that an object holds
  • The planets temperature is directly related to the amount of water in the atmosphere
  • Without water in the atmosphere the earth would be 330 Celsius colder and frozen solid
  • Carbon Dioxide (CO2) is a requirement for life to exist on this planet
  • More Carbon Dioxide (CO2) is better as planets grow faster, less Carbon Dioxide (CO2) is bad
  • Carbon Dioxide (CO2) only indirectly affects temperature probably less than 5% that of water
  • Climate is a measure of the average of all the factors that produce a stable environment
  • Weather is a measure of local factors that may make large changes in daily or seasonal conditions
  • The planets temperature in geological times ranged from170 Celsius +/- 60 Celsius
  • 12,000 or so years ago the last ice age ended for no reason we can determine

 

The first thing that needs to be done when developing a theory is to identify and define the issue or problem. The issue was that after WW II there was a large buildup of industry required to rebuild the devastated planet and that rapid uncontrolled growth created real environmental problems. Much good resulted from the original environmental emphasis such as the creation of the Environmental Protection Agency, EPA, however, others in the 90’s saw a way to gain power and wealth by exaggerating aspects of the movement. During the 80’s and the 90’s global temperatures were going up so these people saw a way to increase the size and scope of government to their advantage with a carbon tax.  They picked increased levels of CO2 in the atmosphere as the strawman argument and funneled large amounts of research money into universities to study how bad the increases were.

Unfortunately, federal grant money is “directed” money so it was given to find out how bad the issue was, not to find out if it was even bad or even real. Therein was the problem as this is a very complex math and physics study in a subject that had not been previously studied in detail such that 30 years later the key variables and relationship are still not known with specify. The mistake that was made in the attempt to quantify the apparent increase in global temperatures was that increased CO2 in the planet’s atmosphere was that CO2 was the ONLY REASON the global temperatures were increasing.  Unfortunately this assumption was not true as there had been several warm and cold periods in history going back thousands of years. The previous little ice age in the seventeenth century was one of these and the warming we now have, about 10 Celsius, is partly from the northern hemisphere still coming out from that cold period.

Next we’ll review some important information on temperatures and how it’s measured. We need to understand the details before we can draw conclusions. The problem, intentional or not, goes back to physics and how we show information. It’s critical that when we talk to nonscientists that information is properly displayed. And nowhere is this more important than when we are discussing global temperature in relationship to anthropogenic climate change.

When we talk about climate (long term changes; centuries) or weather (short term changes; decades) local temperatures are going be in Celsius (C) in the EU and science, or degrees Fahrenheit (F) in America. The base temperature for the earth that NASA established is 14.00 C or 57.20 F; but these are both relative measures and do not tell us how much heat (thermal energy) is there. To know that we must use Kelvin (K) or Rankin (R) and that would be 287.150 K and 516.870 R all four of those numbers 14.00 C, 287.150 K 57.20 F, and 516.870 R are exactly the same temperature, just using a different base. But if the current temperature went from 14.00 C, to 14.860 C that is a 6.14% increase in C, an increase of 2.71% in F and an increase of .30% in K and R; so which one is real? The answer is .30% because Kelvin and Rankin are the only ones that measure the total increase in energy! Table One shows these relationships that we just discussed.

The next step is to plot Carbon Diode (CO2) from NOAA-ESRL and the estimated global temperature as published by NASS-GISS each month.  As can be seen in Table One It doesn’t really matter whether we would use Kelvin and Rankin since the increase in thermal energy is exactly the same either way; but we’ll use Kelvin as that is the accepted norm in the scientific community for determining the amount thermal energy in any object especially when looking at changes in temperature or measuring the thermal energy in any object.  There are other less known temperature scales that have specific purposes but they don’t really apply here in this subject.

The important thing is how much has the temperature actually gone up since we started to measure CO2 in the atmosphere? To show this graphically Chart 8 was constructed by plotting CO2 as a percent increase from when it was first measured in 1958, the Black plot, the scale is on the left and it shows CO2 going up about 30.0% from 1958 to May of 2018. That is a very large change as anyone would have to agree.  Now how about temperature, well when we look at the percentage change in temperature from 1958, using Kelvin, we find that the changes in global temperature are almost un-measurable. The scale on the right side had to be expanded 5 times (the range is 20 % on the left and 4% on the right) to be able to see the plot in the same chart in any detail. The red plot, starting in 1958, shows that the thermal energy in the earth’s atmosphere increased by .30%; while CO2 has increased by 30.0% which is 100 times that of the increase in temperature. So is there really a meaningful link between them that would give as a major problem?

Chart 8 and all the rest of what is shown here in this paper are based on the following two data series. First NASA-GISS estimates of a global temperature shown as an anomaly (converted to degrees Celsius) as shown in their table Land Ocean Temperature Index (LOTI) and shown in Chart 1 as the red plot labeled NASA the scale for the temperatures is on the left. The NASA LOTI temperatures are shown as a 12 month moving average because of the very large monthly variations. Second NOAA-ESRL CO2 values in Parts per Million (PPM) which are shown in Chart 1 as a black plot labeled NOAA the scale for CO2 is shown on the right no change is required to the NOAA data set it is ready to use as is.

NASA published data is shown as an anomaly, but what is a temperature anomaly?  An anomaly is a deviation from some base value normally an average that is fixed. There were two problems with the system that NASA picked which were number one there is no “actual” global temperature and two since climate is a variable and always has been so there cannot be a real base to measure from. NASA known for its science and engineering expertise back in the day thought it could get around these issues and created a system to do so. First they developed a computer model which took the readings from all over the planet and made adjustments to them in software which they called homogenization and came up with the estimated global temperature. Second they picked the period 1950 to 1980 (30 years) and averaged the values found in that period and came up with 14.00 degrees Celsius and make that their base.  Lastly they took the calculated monthly temperature and subtracted the base from it which gave them the anomaly and multiplied the result by 100.

The problem is that both are arbitrary. Why pick 1950 to 1980 as the base period? Is there something special about that time frame? And as to a global temperature there is no such thing for many reasons like the earth faces the sun so one side is cool and onside it warm. Higher latitudes are cooler than the equator and higher elevations are cooler than lower. And finally there are many areas where there are no measurements taken. Therefore there is no one temperature only an artificial artifact solely dependent on the soundness of the software used to create that one temperature!

Chart 1 below is 100% accurate and based only on NASA and NOAA data as published.

Now that we have a base to work with we are going to add to Chart 1 three things. The first is a trend line of the growth in CO2 since that is according to the government through NASA and NOAA the entire basis for climate change. That plot is superimposed over the black plot of the actual NOAA CO2 values as the cyan line labeled as the CO2 model and one can see there is a very good fit to the actual NOAA values so there should be no dispute about its validity, and it’s historically accurate.  This plot allows us to make projections to future global temperatures according to the projected level of CO2The second added item is James E. Hansen’s 1988 Scenario B data, which is the very core of the IPCC Global Climate models (GCM’s) and which was based on a CO2 sensitivity value of 3.0O Celsius per doubling of CO2. This plot is shown here in lavender and is from a presentation that Hansen showed congress in 1988 to help support the UN in setting up the International Panel on Climate Change (IPCC). This plot is labeled as Hansen Scenario B which Hansen stated was the most likely to happen based on his 1979 climate theories’.  The third item is the current plot of the most likely temperature of the planet based on the growth of CO2 published by the IPCC. This plot is shown in Red and is labeled as IPCC AR5 A2 as that is the table where the data was found. This plot is a GCM computer projection of the planets temperature based on the complex relationships developed by the IPCC primarily though NASA and NOAA.

It can be seen in Chart 2 that the lavender plot and the Hansen plot are very close from 1965 to around 2000. However there isn’t a good correlation between the growth in CO2 and the increase in the planets temperature, as shown in Chart 8. The CO2 is going up in a log function and the temperature was going up until 2000 then it plateaued from 2000 until 2014 where there was a mysterious spike up of .5 degrees Celsius just in time for COP21 in Paris. Then after CP21 was over the unexplained change in temperature started to come back down. The climate doesn’t make changes like what the NSA/NOAA data shows that would be weather if it even was real.

Chart 7 looks at the period from 2010 to 2020 so we can see where a change in CO2 of only a few ppm has caused a major change in the global temperature way beyond anything previously shown in any published NASA data. There are three ovals on Chart 7 one at the top of Chart 7 which is a black oval around the CO2 levels from 2010 to 2018 and it’s very obvious that there has been very little change, maybe 3 ppm a year Then at the bottom of Chart 7 is dark red oval around the NASA global temperature levels from 2013 to 2018 and its very obvious that there has been a sudden large change, almost .50 degrees Celsius in 3 years. There has never been such a large increase in temperature from such a small increase in CO2. By contrast the previous comparable period of the last part of 2010 through 2013 Blue oval shows about the same increase per year for CO2 but global temperature decreased.

An explanation is needed here as the NASA temperature plot in Chart 7 seems to show the jump in temperature in 2016 not 2015; this is a result of the very large jump in temperature shown by NASA. Since we are using a 12 month moving average and the increase occurred in only a few months it actually shifted the curve into 2016. The raw data for December 2012 was at a low of 14.44 degrees Celsius but by February 2016 the temperature was at a record high of 15.35 degrees Celsius a .91 degree Celsius increase, Red arrow. With the global temperature over 15.0 Celsius at COP21 in December 2015 at the Paris COP21 conference the climate accord was approved and the manipulation was a success. After COP21 the Fake Warming was no longer needed so we are now seeing a downward trend developing. The current temperature for June 2018 is 14.88 degrees Celsius.

In summary, the IPCC models were designed before a true picture of the world’s climate was understood. During the 1980’s and 1990’s CO2 levels were going up and the world temperature was also going up so there appeared to be correlation and causation. The mistake that was made was looking at only a ~20 year period when the real variations in climate  move in much longer cycles of centuries which can be observed in the NASA data but they were ignored for some reason.  By ignoring those actual geological trends and focusing only on CO2 the Global Climate Models will be unable to correctly plot global temperatures until they are fixed. Also the temperature data from 1850 to 1880 was dropped for some reason as it showed a lower temperature than would be expected. The lower temperatures’ in that period would have shown a shorter cycle they didn’t want shown.

A decade ago when I started looking at “climate” change the first thing I did was look at geological temperature changes since it is well known that the climate is not a constant; I learned that 53 years ago in my undergrad geology and climatology courses in 1964. The next paragraph explains currently observed patterns in climate related to this subject and is historical accurate.

Ignoring the last Ice Age which ended some 11,000 years ago when a good portion of the Northern hemisphere was under miles of ice the following observations give a starting point to any serious study on the subject of climate. First, there is a clear movement up and down in global temperatures with a 1,000 some year cycle going back at least 3,000 to 4,000 years; probably because of the apsidal precession of the earth’s orbit of about 20,000 years for a complete cycle. About every 10,000 years the seasons are reversed making the winter colder and the summer warmer in the northern hemisphere. 10,000 years from now the seasons will be reversed again. Secondly, there are also 60 to 70 year cycles in the Pacific and the Atlantic oceans that are well documented. These are known as the Atlantic Multi Decadal Oscillations (AMO) in the Atlantic and as La Nina and El Nino in the Pacific. Thirdly, we also know that there are greenhouse gases such as carbon dioxide that can affect global temperatures. Lastly the National Academy of Sciences (NAS) estimated that carbon dioxide had a doubling rate of 3.0O Celsius plus or minus 1.5O Celsius in 1979 when there were only two studies available and one for sure and maybe both were not peer reviewed.

The result of looking objectively at the three possible sources of global temperature changes was a series of equations based on these observations that when added together produced a sinusoidal curve that seemed to follow NASA published temperatures very closely when first developed in 2007, and modified a few years later when it was found the short and long cycles were related to multiples of Pi.  Since this curve was based on observed temperature patterns it was called a Pattern Climate Model (PCM) which has been described in previous papers and posts on my blog and since it is generated by “equations” many assume it is some form of least squares curve fitting, which it is not. It does seem to be related to ocean currents where the bulk of the planet’s surface heat is stored and cloud formation.

Chart 5 shows the PCM a composite of two cycles and CO2. There is a long trend, 1036.7 years with an up and down of 1.65O Celsius (.00396O C per year) we in the up portion of that trend. Then  there is a 69.1 year cycle that moves the trend line up and then down a total of 0.29O Celsius and we are now in the downward portion of that trend (-.01491O C per year), which will continue until around ~2035. Lastly, there is CO2 currently adding about .0079O Celsius per year so together they all basically wash out at -.0039O C per year, which matches the current holding pattern we were experiencing until 2014. After about 2035 the short cycle will have bottomed and turn up and all three will be on the upswing again duplicating what was observed in the 1980’s.  Note: the values shown here are only representative from what is in the model.

When using a 12 month running average for global temperatures up until 2014 the PCM model was within +/- .01 degrees of what NASA was publishing in their LOTI table since the early 1960’s as shown in Chart 5. Further the back projection of the PCM plot matched historical records and global temperatures going back past the time of Christ. It should also be considered that geologically CO2 levels have reached levels many times that of the current 400 ppm without destroying the planet so the current hysteria over the current very small numbers can only be explained by political science not real science.

Lastly, Chart 9 shows what a plot of the PCM model, in yellow, would look like from the year 1400 to the year 2900. This plot matches reasonably well with recorded history and fits the current NASA-GISS table LOTI data, in red, very closely, despite homogenization.  I do understand that this PCM model is not based on physics but it is also not some statistical curve fitting. It’s based on two observed reoccurring patterns in the climate and a factor for CO2. These patterns can be modeled and when they are, you get a plot that works better than any of the IPCC’s GCM’s. If the real conditions that create these patterns do not change and CO2 continues to increase to 800 ppm or even 1000 ppm then this model will work well into the foreseeable future.  150 years from now global temperatures will peak at around 15.750 to 16.000 C and then they will be on the downside of the long cycle for the next ~500 years.

The overall effect of CO2 reaching levels of 1000 ppm or even higher will be about 1.50 C which is about the same as that of the long cycle.  The Green plot on Chart 9 shows the observed pattern with no change in CO2 from the pre-industrial era of ~280 ppm. CO2 cannot affect global temperatures more than 1.500 C +/- no matter what the ppm level of CO2 is. The reason being that the CO2 sensitivity value is not 3.00 per doubling of CO2 but less than 1.00 C per doubling of CO2 as shown in more current scientific work and it’s a logistics curve not a log curve.

The purpose of this post is to make people aware of the errors inherent in the IPCC models so that they can be corrected. 

The Obama administration’s “need” for a binding UN climate treaty with mandated CO2 reductions in Europe and America was achieved as predicted at the COP12 conference in Paris in December 2015. To support this endeavor NASA was forced to show ever increasing global temperatures that will make less and less sense based on observations and satellite data which will all be dismissed or ignored.  Within a few years the manipulation will be obvious even to those without knowledge in the subject, but by then it will be to late the damage to the reputation of science will have been done. Fortunately President Trump pulled us out of the bad agreement.

In closing keep this in mind. The current panic generated by the government using political science is that the current global temperature of around 15.0O Celsius is an increase of 7.14% from the 1960’s when the global temperature was 14.0O Celsius; and that does seem like a lot. However those views would be in error as the actual increase in thermal energy, as measured by temperature, would be only .35% because we must use Kelvin not Celsius when working with heat energy. When we use kelvin the temperature goes from 287.15O K to 288.15O K which is only .35% not 7.14% about 1/20 of what is implied by the IPCC. What the IPCC shows is not technically wrong as much as it is extremely misleading to anyone without a science background.

Sir Karl Raimund Popper (28 July 1902 – 17 September 1994) was an Austrian and British philosopher and a professor at the London School of Economics. He is considered one of the most influential philosophers for science of the 20th century, and he also wrote extensively on social and political philosophy. The following quotes of his apply to this subject.

If we are uncritical we shall always find what we want: we shall look for, and find, confirmations, and we shall look away from, and not see, whatever might be dangerous to our pet theories.

Whenever a theory appears to you as the only possible one, take this as a sign that you have neither understood the theory nor the problem which it was intended to solve.

… (S)cience is one of the very few human activities — perhaps the only one — in which errors are systematically criticized and fairly often, in time, corrected.

 

 

Jul 20 2018

Largest Iceberg & Crazy Weather


Armstrong Economics Blog/Nature

RE-Posted Jul 20, 2018 by Martin Armstrong

QUESTION: You said while the energy output of the sun declines, at the same time the summers can get hotter. It seems strange but my daughter lives near you in Florida and it is hotter here in New York. Is the weather just getting crazy?

ANSWER: This summer we should see sweltering heat build across parts the northern United States and over western and central Europe throughout the summer months. The temperatures will be hotter in the Northern regions which definitely seems crazy. It is more comfortable in the South than in the North. These regions will simply see high temperatures past 90 F (32 C) up to 100 F (38 C ) on numerous occasions from June through August from probably Toronto to the Carolinas in the USA and in Europe from Frankfurt down to Milan/Rome.and Berlin, Germany.

There seems to be a pattern historically of dry summers and cold winters for Europe while in the Eastern US there will generally be flooding. This can contribute to producing dangerous conditions for not just people, the young and elderly, but to further the cycle of drowning crops in the US to droughts in Europe. This historically also tends to create the cycle of famine. The entire process is plagued by higher volatility with the swings to both extremes. This builds in cyclical force much as a bull market in a volatility period.

Meanwhile, the largest iceberg to ever threaten the shoreline in Greenland has appeared. An 11-million-ton iceberg, 300 feet tall, is now hovering over the town of Innaarsuit in Greenland. The massive iceberg floats dangerously close to shore coming within just 500 to 600 feet offshore last weekend. This is all part of perhaps the shift in climate that is brewing.

Jul 19 2018

Our Journey Through Life


Armstrong Economics Blog/ECM

RE-Posted Jul 19, 2018 by Martin Armstrong


QUESTION:  Hello Martin. Over the years I have read so much of your adventurers (if you could call them that =) and some of the great masters you
quote from time to time.

I know you have done a massive amount of research on your own. I was wondering about some of the unknown people in your early days. Like when you first started programming on wall street. People who shared things with you that gave incite… or steered you in the right directions knowledge wise. People who keyed you in on trading, markets and so forth.

It would be interesting to hear if you could share.

Alright, Nice evening to you sir.

N

ANSWER:  Life is a math equation. Life = Sum(x + y + z). Everything we do accumulates and the sum forges our character-defining who we are. Experience = knowledge. Nobody is ever born knowing everything. We learn ONLY from our mistakes so cherish them well for they are what make us who we are. When there is nothing left to learn about this world, then it is time to leave. Never be afraid to question for unless we have questions, we will never arrive at answers.

People often ask me why I am not bitter for the injustices I have fought against in New York. They have been absorbed and contribute to my understanding of life. In our natural habitat, we tend to judge others by ourselves. We need to be confronted by the opposite to understand its very nature. I have seen the corruption of the Judicial system from the inside out and am so glad I did not become a lawyer as my father wanted. You learn that there are truly evil people who know what they do is wrong, so they try to oppress and even kill those who would expose them. They deny all wrong-doing and pretend to be so upright, but someone who really is upright never pretends to be because they do not have to. The fact that they must act in this manner demonstrates that they themselves know they are evil or they would stand in the light of day. Just mind-blowing how people can act so corruptly and then sleep at night. There was one kid they were charging with conspiracy for murder because someone asked him where a person was he pointed to him and they killed him. The wanted the death penalty. The prosecutor refused because the kid had no priors and was 23. He quit and the next prosecutor had no problem trying to kill this kid for a conspiracy all because they wanted to win the first death penalty case in New York City regardless of who it was they would kill. Some of the evilest people in the world go to the Justice Department.

My father pushed me into computers because I was probably a natural trader which he disapproved of and I decided I did not want to become a lawyer. I was also not motivated by the education system. I suppose I began to see that those teaching did not have actual experience in what they taught. The ancient Romans had the best school system. You have the basic reading, writing, math, as well as history. However, you would decide what you wanted to do in life and left what would be called grade school to seek an apprenticeship. My father was going to take us to Europe for the summer, I believe, in 1964. I wanted to earn some money for myself and got a job in a coin/bullion store. Yes, you could buy gold before 1975 in coin form. There were countries who produced restrikes to be able to sell gold. Hungary issued coins data 1908 and Mexico kept the date 1947 on 50 pesos. Gold coins were legal for “collectors” as long as they were dated 1947 or earlier.

That was my apprenticeship for I began to see markets and observed the daily fluctuations. Silver was rising in price and President Kenney signed in 1963 the Executive Order 11110 on June 4th, 1963 to remove silver from the coins starting in 1965 before he was assassinated. Just about every country soon followed by 1965-1966. They two years later is when Bretton Woods began to crack in 1968 and a two-tier market in gold began – private and official. Gold begab to trade in London. It didn’t trade in the USA until 1975.

Going to Europe, we traveled the entire summer driving from Sweden down to Naples to visit Pompeii. I became the navigator but it also was a quick introduction to foreign exchange. We would have to exchange money at each border. I have a few 1964 Kennedy half-dollars. Whenever I would pull one out, whatever the bill was if $10 to $25, they just wanted that coin instead. It taught me early lessons about arbitrage. I remember telling my father we should have come to Europe with a bag of them and we would have paid for everything.

Every door we open in life leads to another. I have never been one to be afraid of trying something new. Failure is how we learn and success is our reward. Had I not gotten a job in that coin store where I bought my first Roman coin for $10, I would not be here today writing this. That is what I mean that we are the sum of our experiences. I was in history class and the high school professor brought in an old film The Toast of New York. It was a film about the Panic of 1869 and the attempt of Jim Fisk to corner the gold market. In this clip, you will see what sparked my imagination and sense of curiosity given my exposure to reality by working. Jim Fisk is at the ticker-tape, and he then turns to his girlfriend and quotes gold at $162. Now I knew from working that gold was $35. Suddenly, I was confronted with an anomaly. I was being taught that everything was linear. So how was it possible that gold could be $162 in 1869 and $35 today in the 1960s?

At first, I assumed it was just a movie. But it bothered me. There was a QUESTION in the back of my mind that would not be answered. I went to the library and looked up the price of gold in the microfilm copies of The New York Times. There it was, the quote, $162. It was real. It profoundly shook my belief system to the very foundation.

Countless questions were running around my mind like a pack of wild animals being chased. I began to ask questions in economics class. The answer was even more disturbing. Well, there was this thing that they once called the business cycle, but the government has eradicated that I was told.  It was a real bull market in everything going into 1966. Rare coins peaked. I remember an 1877 Indian Head Penny was sold for $700. It crashed by 50% in months and never saw that price again for at least a decade. Pennies were the hot thing back then. I was buying and selling and it taught me how to trade. I made so much money my father convinced me to invest in mutual funds. I did, and then the stock market collapsed and the mutual fund dropped from $54 to about $5. I asked my father if this was the way conservative people made money? My speculating in commodities was much more profitable than stocks I knew nothing about at that time.

I began to notice that there were certain things that were hot and others that were cold. The pennies were soaring but not ancient coins or many other denominations of American coins. Collectibles market crashed with the 1966 stock market crash as did mutual funds. The Crash of 1966 was followed by another in 1968 when the two-tier market in gold began with the crack in Britton Woods. The real estate crashed in 1970 as well. But even more confounding, gold actually fell BELOW $35 in 1970 – the old Bretton Woods fixed rate that everyone assume would hold.

There was no mentor back then. You had to learn from observation. Bretton Woods was collapsing and nobody knew what would even happen no less forecast what would come by 1971. I was finished with high school, but the nagging questions only multiplied. Clearly, there was some sort of a cycle. It did not matter if it was stocks, bonds, coins, collectibles, foreign exchange, or real estate. It was obvious that everything went through the same boom and bust cycle.

I was doing my own research now in the Firestone Library at Princeton University. I was searching old newspapers, looking for previous prices of booms and busts that I had been confronted with in gold. That’s when I stumbled upon an article that listed previous panics between 1683 and 1907. This was an old article published even before the 1929 Great Depression. That is why the list stopped with 1907. It was even pre-World War I.

 

That’s when I also stumbled upon this illustration of a business cycle published on February 2nd, 1932 in The Wall Street Journal. I took the list I found that covered a span of 224 years and I divided it by the 26 events which yielded the 8.6-year average. I began to test through history which I knew well. The rest is history itself as they say (see wave structure). So no, there was nobody to talk to back then. You had to learn everything on your own. It was not until the Crash of 1974 that Paul Volcker was inspired to call it “The Rediscovery of the Business Cycle” because they did not even teach the existence of such a cycle. It was supposed to have been conquered by the government with Keynesianism. It was an age of rediscovery indeed. There was no place to go. Gold futures began in 1975, bonds 1977 and S&P 500 futures in 1985. There were no trading clubs. I was on my own.

Jul 18 2018

China Venture Capital Raising now Exceed the USA


Armstrong Economics Blog/China

Re-Posted Jul 18, 2018 by Martin Armstrong

Believe it or not, Chinese start-ups have for the first time collected more venture capital than newly established US companies in the past quarter. This is reported by the South China Morning Post . Almost half (47%) of the venture capital used worldwide was spent on start-ups from the Middle Kingdom. The American start-ups were only just over a third (35%). This is part of the entire real reason why China will be surpassing the United States and take the title Financial Capital of the World. 

We will be releasing a printed report on this subject covering all the topics from politics to economic

Jul 18 2018

Why CONFIDENCE is the Backbone of the New Monetary System


Armstrong Economics Blog/Monetary Reform

Re-Posted Jul 18, 2018 by Martin Armstrong

QUESTION: Mr. Armstrong; I found your recent article on inflation and contagions fascinating. Am I correct in summing it up that today because currencies are not commodity based, they rise and fall on anticipation of political events whereas under precious metals contagions took place by one country debasing compared to another?

Thank you for your reply;

EG

ANSWER: Correct. The monetary system has been altered far more than people understand. The question of money supply and inflation was philosophically established with Gresham’s Law. Gresham worked in Amsterdam and witnessed the response to the debasement of Henry VIII in England. His proposition that bad money drove out good money from circulation was one important observation. As countries would debase, people would hoard the old coinage, and actually, the money supply would shrink. It then requires a greater production of debased coinage to maintain an adequate money supply. This results in more debasement and unfolds in what people call hyperinflation. Yet, it is much more than simply just producing debased coinage or in modern time printing more money.

In addition to this observation, what is overlooked is frankly the driving forces behind the foreign exchange markets during the precious metal based monetary system and the modern paper monetary system (soon to be electronic based monetary system). Under a precious metal system, the coinage of one nation is compared and exchanged with others based entirely on its monetary value based on metal content. If England was at war with France, this had zero impact upon the value of their coinage as long as there was no debasement. Once debasement began, then the exchange rate between one currency and another changed.

Consequently, this influence of anticipating future value based upon possible political decisions was not readily dominant and the coins of one nation were compared entirely on their metal content rather than political events. When money began to appear as paper currency, this altered the monetary system for then the value of that currency was dependent upon the “confidence” of the people in that currency. Bank runs would emerge when people lost confidence in that establishment surviving.

The Latin Monetary Union was an attempt to create a gold standard whereby member nations issued a standard coin of equal weight and metal content as to allow them to be interchangeable. Therefore, 20 French francs was equal to 20 Italian lire, 20 Belgian francs or 20 Swiss francs. The problem with commodity based monetary systems has always been that domestic economic trends in one country are exported as contagion to others. For example, the Spanish discovery of South American led to a massive influx of gold and silver coins which then created a contagion of inflation (lowering the purchasing value of coinage) throughout Europe.

The waves of gold discoveries during the 19th century also created huge instabilities in the business cycle resulting also in waves of inflation. This is what Kondratieff studied to come up with his long wave theory. War has always resulted in waves of inflation as governments have had to increase the money supply to pay for these expenses. The US national debt exploded by $1 trillion for the Iraq war. We find from the very beginning of coinage in Lydia, its war against Cyrus the Great of Persia also resulted in a debasement of the very first coinage.

There are clearly established driving forces behind the monetary systems rise and fall. What we must come to understand is that a commodity based monetary system NEVER produced a perfect world where money was tangible and worth something. There were always waves of inflation based upon the discovery of new metal deposits. If we had a money supply that could NEVER change, then you would create deflation as the population grew. If there were only 10 gold coins and a population of 5 people, then everyone could have two coins, but one will inevitably have 4 because they invented something others wanted. Increase the population to 10, then the value of the 10 coins will rise in value meaning asset values will decline creating deflation.

 

Therefore, a tangible monetary system has never eliminated the business cycle and it will never bring “stability” as people preach. What has taken place is that by moving to a paper monetary system and a unit of account, which is increasingly more electronic (since paper money is less than 5% of commerce), the “confidence” factor that was once predicated upon the metal content has migrated to political events and thus we anticipate the future possibilities in the current value of any currency.

 

 

Here is a chart of Bitcoin. Once again, we do not see an instrument which is immune to the business cycle. It does not matter if we are dealing with coins, paper money, or electronic entries. Everything will still be subject to the business cycle. There will NEVER be any such exception. Moving forward, the only way to isolate contagions to some degree will be to create a basket of currencies as the international unit of account. It will still rise and fall in value. It cannot be permanently fixed.

 

Therefore, while our computer forecasts that China will emerge as the Financial Capital of the World after 2032, those who hate the dollar and keep calling for its demise fail to understand that the more critical element that will make the China yuan a major global currency is when the “confidence” level rises among big capital and they feel “comfortable” parking their money in Chinese bonds, assets, etc. China is moving in that direction slowly. They will eventually allow their currency to be freely traded and currency controls will vanish. As that dawns, then we will see the yuan rise in global respect. They are moving to achieve that position. It just takes time.

We MUST comprehend that contagions have existed in ancient times to modern times regardless of the monetary system be it precious metals, paper, or electronic. We are all connected and the sooner we come to grips with that understanding, the sooner we can move forward in our evolution of money. Even the creation of money by banks through lending is driven by the business cycle

Jul 17 2018

Boston University Graduate Alexandria Ocasio-Cortez Explains “Economics”…


Re-Posted from The Conservative Tree House on July 17, 2018 by

According to DNC Chairman Tom Perez, Ms. Alexandria Ocasio-Cortez is “the future of the Democrat party.”  Ms. Ocasio-Cortez has a bachelors degree in “economics” and “international relations” from Boston University.

Born in 1989, Ms. Ocasio-Cortez is a millennial and a self-described democrat socialist.  In this interview segment she discusses a millennials’ view of economics:

On the dynamic current economy, 3.8% unemployment and capitalism providing expanded economic opportunity:

“unemployment is low because everyone has two jobs.”  “Unemployment is low because everyone is working 60, 70, 80, hours a week and can barely feed their kids”… “capitalism has not always existed in this world, and it will not always exist in this world.”

…Some people… and such, have jobs… it’s hyper-capitalism, that’s unemployment. Because it’s all like, you know, so unfair and stuff!

This is a millennial with a four-year degree in economics and international relations from Boston University; who won a primary race for congress and could very likely be heading to Washington DC as a political representative of New York.

Let that sink in.

Jul 17 2018

Documenting History with Coins


Armstrong Economics Blog/Ancient History

Re-Posted Jul 17, 2018 by Martin Armstrong

QUESTION: Dear Martin,
I have been researching facts about history and there is strong evidence that what we were taught in school doesn’t fit with the reality. As you have a very vast coin collection, which is part of your research, how can you be sure of the timeline about those coins? I remember from your blog statements that many years are missing in the Japanese coinage and a very sudden drop in Roman silver minted coins. Greek, Roman and many other coins do not have any dates on them as we know it now. Is there any slight chance that years have been added to history by academia to fit their narrative?
Regards, Patrick.

ANSWER: Greek coins are not dated. Most have been determined based upon the archaeological discoveries. Therefore, Greek coins cannot be specifically dated to an individual year. What can be determined is the sequence of rulers and we can determine date approximations often from contemporary writers. The lack of coins in Japan for nearly 600 years simply means that there is no Japanese numismatic record. However, foreign coins are discovered in Japan. Chinese coins were used because they were not devalued with each new emperor as was the case in Japan. There have even been Roman coins discovered in Japan confirming there must have been some trade connection albeit indirect.

The Roman coinage is easy to date because Rome had overthrown the king and began the Republic during the 8th century BC. Therefore, an emperor was never portrayed as a “king” but maintained the pretense of being elected like our politicians today – the curse of a Republic. On the obverse of this Roman coin of Domitian (81-96AD), we see TR P VIII meaning this was the eight year of his reign since his Tribunicia Potestate – The Tribunician power, which had to be renewed each year as a pretence of being elected by the Senate, the same structure the EU today uses to appoint the head of the EU who never stands for public election either. Domitian had served as consul with his brother Titus before he succeeded him as emperor following his death. Therefore, the reserve of the coin shows he was also the Consul serving for the XIIII (14th) time. Again, these are one-year terms.

Here we have a coin of Brutus which boasts that he killed Julius Caesar on the Ides of March (15th) in 44 BC. We also have a coin of Titus announcing the opening of the Coliseum. The Romans used the reverse side of their coins often as a newspaper announcing events and victories. The Greeks were interested in art. They competed for design, but they did not use the coins as a means of propaganda.

This coin of Saturninus is probably one of the most important Roman coins ever discovered. The Latin work Historia Augusta was written during the reigns of Diocletian and Constantine I in the late 3rd century AD. The work recorded the lives of emperors and usurpers in Rome before Diocletian. It was a collection of thirty biographies. Of course, some academics pronounced it was a fake as they did with Homer because it listed people they never heard of during the collapse of the Roman Empire during the Monetary Crisis of the 3rd century. They challenged both the authorship of the work as well as its date ever since Hermann Dessau (1856-1931) whose claim to fame as a historian came in 1889 when he rejected both the date and the authorship the manuscript. He argued there were major problems that include the nature of the sources and how much of the content he claimed was pure fiction. He was proven completely wrong when this coin and one other coin was discovered in Egypt. Saturninus was one of the names of a usurper he claimed never existed.

Here is a denarius of Julius Caesar showing a captive at the foot of a trophy. Note that the man has wild hair and a beard. It is believed that this coin represented the capture of Vercingetorix, the leader of the Gauls. Of course, the writings of Caesar and his conquest of Gaul have survived.

Coins have in fact called into question recorded history. But academics far too often defend old interpretations and refuse to revise previous assumptions. For example, the very date that Vesuvius erupted burying Pompeii is by no means definitive although you will find August 24th, 79 AD as the date carved in stone. This date has been interpreted from a letter to the historian Tacitus some 25 years following the event. This was his old friend Pliny the Younger who provided an eye-witness account of the eruption. He states that the eruption took place on Nonum Kal September (the ninth day before the Kalends of September), which has been calculated as August 24th. However, Tacitus was translated during the 16th Century which remains questionable on many points. The ancient historian Cassius Dio directly states that the disaster took place “towards the end of the harvesting season” which would be in October, not August.

The excavation of Pompeii revealed that the stores were selling fruit that would not have been seasonal for August. There were amphoras filled with wine after the harvest which had been sealed and ready for transportation and sale. Many of the people discovered were wearing warm clothing. That has been dismissed as they just wanted to cover themselves. But during excavations of Pompeii’s “House of the Gold Bracelet” in 1974, 180 silver and 40 gold coins were discovered with the bodies of a group of victims. The coins were buried with the people attesting to their link with the eruption. The coins were never cataloged until 2006. There was one coin that confirmed that the date for the eruption of Pompeii was incorrect and that the account of Cassio Dio was closer to fact than Tacitus.

Titus was emperor at the time of the eruption and he was remembered for the relief efforts. Titus’ administration was marked not by military or political conflicts, but by disasters. His first disaster was the eruption of Vesuvius. The eruption destroyed the cities and resort communities around the Bay of Naples in addition to Pompeii and Herculaneum which were buried under many feet of stone, ash, and lava. Titus appointed two ex-consuls to organize and coordinate the relief effort. He personally donated large amounts of money for the relief effort and he even personally toured the region the following year like presidents do today after such disasters (human nature never changes).

A single silver denarius was discovered among the 180 silver coins in 1974. When it was cataloged, it overturned history and has ever since been buried again in the Naples Museum rather than rewrite the history books. Titus’ father Vespasian died on June 24th, 79 AD. Therefore, any coin of Titus as emperor would have to have the very first recording of his power “IMP VIIII” or 8th Imperator, which was a title that meant ‘leader of the army’ to the Romans. The award was generally given at this point in history for a particularly important victory that was celebrated. In some cases, these subsequent awards, denoted by a numeral following IMP, which also allows dating of coins to a very short period.

The coin discovered in Pompeii had the legend “IMP XV,” which was granted to Titus for the war in Britannia where he sent Gnaeus Julius Agricola who pushed further into Caledonia and managed to establish several forts there as recorded by Tacitus (Agricola 22). Therefore, Titus received this title of Imperator for the fifteenth time for this event, according to Cassius Dio (Roman History LXVI.20). This took place we know in September 79 AD about 3 months after becoming emperor following his father’s death. Obviously, if any coin was discovered in the ruins of Pompeii with “IMP XV” in its legend, then this provides absolute proof that the date for Vesuvius of August 24th, 79 AD cannot be correct.

There are plenty of discoveries that have challenged the view of history. Roman swords have been discovered in Newfoundland for example. The Romans knew the world was round and NOT flat. They pictured a world that is round on countless coins. The one scepter that has survived from any Roman Emperor, Maxentius (306-312 AD), has a globe on it symbolizing that the Emperor ruled the entire world, which was a nice political boast.

Strangely enough, the coins have documented history even when academics choose to try to ignore them rather than admitting they are wrong. It just seems that people do not want to ever admit making a mistake. The academics are no different than politicians, and even the Catholic Church tried to pretend there were no allegations that were valid against some priests. The problem with this posture is that as this policy is supported, they undermine the credibility of everyone in that profession. Academics are no exception. Just revise history and get on with it.