Posted originally on the CTH on December 18, 2023 | Sundance
In the world of tracking geopolitical maneuvers closely, particularly as it relates to military intervention, it becomes critical at a certain point to get more deliberate.
Two fronts seem like they are about to open on the geopolitical stage. The first in Yemen, the second in Moldova. We can watch them unfold together if we begin from the same baseline.
Against the background of the Israeli-Gaza war against Hamas terrorists, the U.S. military is about to begin a large-scale operation in the Red Sea under the auspices of combating Houthi rebels and terrorist attacks. Against the background of the Ukraine-Russia conflict, we can also anticipate NATO opening a new front using Moldova.
♦ YEMEN – As the U.S. and “coalition partners” begin military engagement against the Houthi rebels, no one in Western media will draw contrast to the State Dept earlier this year sending another $444 million via USAID (a CIA front group) to Yemen. Factually, the U.S. has spent $5.4 billion, yes that’s with a “b”, in Yemen through the State Dept {link}.
We are now going to begin military operations against elements within Yemen as part of something called “Operation Prosperity Guardian,” a new international effort deal with Houthi threats.” As this announcement is made, likely tomorrow, ask yourself what we spent $5.4 billion to achieve in Yemen, if we are now forced to use the U.S. military.
WASHINGTON – Top Biden administration officials are actively weighing options to strike back at Houthis in Yemen after the Iran-backed group launched new attacks on naval and commercial ships in the Red Sea on Saturday, according to two U.S. officials.
The Pentagon has in recent days moved the Dwight D. Eisenhower Carrier Strike Group from the Persian Gulf into the Gulf of Aden, off the coast of Yemen, to support a potential U.S. response to attacks, said one of the officials, both of whom were granted anonymity to speak about sensitive plans. The military has also provided options to commanders to strike the Houthis, the official said.
The Biden administration has been reluctant to respond militarily against the Houthi attacks on commercial shipping in recent weeks for fear of provoking Iran, which backs Hamas and Hezbollah in Yemen as well as the Houthis. Previously, the Pentagon had recommended the administration not do so.
But a significant uptick in attacks in recent days could potentially lead top U.S. national security officials to change their calculus.
The destroyer USS Carney, operating in the Red Sea, shot down 14 one-way attack drones launched from Houthi-controlled territory in Yemen early Saturday morning. Meanwhile, a British destroyer, the HMS Diamond, which had recently arrived in the region to help protect commercial shipping, also shot down a Houthi drone. (read more)
Given the scale of dedicated U.S. naval and air military resources in the region, direct engagement with Yemeni “terrorists” is all but certain. This will expand the overall conflict zone and pull the U.S. into ancillary combat missions.
Iran and the various proxies will likely not respond in Yemen, but U.S. military personnel deployed in Syria, Afghanistan and Iraq will likely come under fire. Chairman Xi will smile from Beijing.
♦ MOLDOVA – Watch this landscape closely.
Ukraine is losing badly, and U.S. led NATO efforts need to change the dynamic. We can anticipate Moldova playing a key role in what comes next.
Watch out for the CIA, DoS, influence over Western NATO allies to create a battlefront against Russia using Moldova.
The basic premise would be for some kind of kinetic action to take place on the Moldova/Ukraine -v- Russia conflict zone (Odessa region), likely created by organized CIA operations, that will then provide the predicate for a second and more direct NATO front against Russia to take the pressure away from direct engagement in Ukraine.
Again, USAID operations (non-pretending, the CIA) have been all over Moldova for the past several months. Something is going to trigger there, and Vladimir Putin can also see it, see the Lavrov statementfrom November 30.
WASHINGTON – The Biden administration plans to announce one more package of military aid to Ukraine this month, National Security Council spokesperson John Kirby told reporters on Monday. But after that, funding for Ukraine will dry up, he said.
“When that one is done … we will have no more replenishment authority available to us. And we’re going to need Congress to act without delay,” Kirby said.
The Pentagon still has $4.4 billion in presidential drawdown authority to provide weapons to Ukraine directly from Defense Department inventory, according to Pentagon spokesperson Lt. Col. Garron Garn. But the weapons DOD can transfer to Ukraine are limited by the necessary funding to replenish U.S. stockpiles, and that’s what is almost gone. (more)
The American public is growing tired of seeing billions spent on Ukraine, and the administration is having a difficult time maintaining support. Throughout the EU, this is also the consensus opinion of the ordinary European.
Those who control the Biden war machine need to change the dynamic. They need a new proxy front to justify conflict with Russia. WATCH Moldova!
Posted originally on Dec 18, 2023 By Martin Armstrong
QUESTION: I have watched this video of David Webb, who distorts the history of the Great Depression, making it sound like the Fed was created to take all the gold when it was formed in 1913. Roosevelt’s “taking” was in 1933, 20 years later. As you and Milton Friedman pointed out, there was a shortage of money during the Great Depression. You provided even the catalog of over 200 cities that issued their own money. I have bought some myself now.
Am I wrong, but this guy has glued facts together, making it sound like they will take all securities like they did gold, and you will have nothing? I am unsure he understands the difference between a secured and an unsecured creditor you learn in basic finance. Then he claimed to be a hedge fund manager, but if this is the same David Webb, he sought to raise money to be just an equity fund managerand registered with the SEC. That is not a hedge fund manager who deals internationally.
Your comments would be enlightening.
FB
REPLY: The Fed was created in 1913 and had nothing to do with confiscating gold. Roosevelt’s Brain Trust was against gold confiscation. Roosevelt did that NOT to confiscate assets, only gold not the dollar in your account. That had NOTHING to do with the shortage of money but funding his Marxist agenda. Europe defaulted in 1931, and the Fed kept money tight to maintain confidence that the US would not default like Europe. People hoard their wealth in times of uncertainty. That is why even Roman Coin hoards correlate to the civil wars and fate of the 3rd century. The hoarding of wealth during the Great Depression contracted the velocity of money during that time, resulting in cash shortages.
George Warren (1874-1938) recommended the dollar’s devaluation because it had risen so high that politicians imposed protectionism. After all, they, too, did not understand the currency. Warren was called the farmer economist, but it took someone who understood international markets to see the problem was the high dollar value. Roosevelt put a spin on that, confiscated the gold at $20.67, and then devalued the dollar to $35—the profit he used to fund his socialist agenda.
Yes, I agree; there seems to be a misunderstanding of title and law. There was a Supreme Court case that goes to this very question of secured title to assets and unsecured. Grupo Mexicano de Desarrollo, S. A. v. Alliance Bond Fund, Inc., 527 U.S. 308 (1999). The court overruled a district court that seized UNSECURED assets, and the Supreme Court ruled there was no such power to do so before a judgment. That power resides only with SECURED assets such as a mortgage where the title has NOT passed to the homeowner until he has paid off the mortgage.
The problem with a brokerage house is that if you have contracts or shares, and certainly if you are trading on margin, the title is NOT yours. Just like a mortgage, you have to own it 100% outright. In the case of MF Global, Bankruptcy Judge Martin Glenn seized all the client’s funds and attributed the losses to them as a whole, for they were UNSECURED creditors.
Martin Glenn was the judge in New York on M.F. Global bankruptcy. He was the first to engage in FORCED LOANS by abandoning the rule of law to help the bankers by protecting them from losses and taking client accounts to cover M.F. Global’s losses. That is no different from what we saw in Cyprus. He allowed the confiscation of client funds, which were UNSECURED when the rule of law was that the bankers were responsible and M.F. Global’s losses should have been reversed. The client’s funds should never be taken for M.F. Global’s losses to the NY Bankers. Judge Martin Glen placed the entire financial system at risk by trying to protect the bankers. He pampered these bankers, making them the new UNTOUCHABLES. We must be concerned that no rule of law will protect you in a crisis.
When you deposit money in a bank, you are a UNSECURED creditor. When a bank fails, you get in line with all the other depositors. The same thing would take place when a government defaults. You are still an UNSECURED creditor. Unless the government intervenes, current shareholders in any major company will be wiped out in a bankruptcy court, and the stock becomes worthless because shareholders have no claims on the company’s assets in bankruptcy court. Take the GM filing for Chapter 11 reorganization in the Manhattan, New York federal bankruptcy court on June 1, 2009. GM bondholders will fare slightly better than shareholders. GM owed a total of $33 billion to bondholders; $6 billion was SECURED, and $27 billion was UNSECURED. Secured bondholders were willing to accept lower interest payments than unsecured bondholders to be at the top of the list of creditors to be paid back if the firm entered bankruptcy. The shareholder lost most of their value, and the company had to issue more shares to raise money. The SECURED creditor comes first, just like the bank owns your property until the mortgage is paid.
To suggest that the government is going to take everything you own is just not true. That would be REVOLUTION time, and the government would collapse instantly, for not even the army would support them. You MUST understand the difference between an UNSECURED and a SECURED creditor. Equating this to the taking of gold is not the same situation. Your money in the bank at the time was expressed in dollars – not ounces of gold. The Supreme Court held that changing the backing of the dollars did not change the dollar you had or owed.
The governments will NOT seize the ownership of everything. They rely on the military for power. Just as in Russia, when Yeltsin stood on the tank and pleaded with the military not to kill their fellow Russians, once they stood down, the coup collapsed. In China, the military obeyed, but to a limited degree, forcing the government to change direction in 1989. The government could NEVER seize everything without the military backing them up.
Posted originally on Dec 17, 2023 By Martin Armstrong
QUESTION: Marty: You have mentioned that Trudeau’s freezing of accounts of anyone who donated to the Truckers was a test run for CBDCs. Do you think this is the end goal to control 100% of our lives?
GD
ANSWER: Hopefully, this will become a Presidential campaign issue. But they are desperate to stop Trump. Congress, including the traitors pretending to be Republicans, passed legislation that NO president can withdraw the US from NATO. This will enable the Neocons to start war BEFORE the 2024 election, and this legislation is to usurp the power of the president, assuming it might be Trump to make it so that he cannot exit World War III. Every politician who voted for that legislation should be thrown out of office in 2024 – PERIOD!
That said, the CBDCs are intended to control our social behavior. This transforms society into a digital prison, which is why the Founding Fathers outlawed Direct Taxation. The rally to Marx at the end of the 19th century led to the introduction of the Income Tax in 1913, and they swore they were going only after the trich. By World War II, they introduced the Payroll Tax because Roosevelt’s Marxist agenda was to include Social Security, and we, of course, had to be FORCED to save for our own future. That became a slush fund that was restricted to buying only government debt to fund this Marxist agenda.
You are being imprisoned with every piece of legislation, like reporting $600 transactions through various cash apps. You have lost ALL your LIBERTY – you don’t know it yet. They could simply create some nonsense and prevent you from donating to Trump or RFK and just make up some nonsense charge. The January 6th had unmarked buses filled with federal agents dressed as MAGA supporters before anyone showed up to stage the event so they could charge Trump and use the 14th Amendment to prevent him from gaining the White House. The Democrats refused to let RFK in, and Biden refused to give him Secret Service protection. In Florida, they tried to remove any contender from the ballot to challenge Biden. This is all about creating war. They let the border open to allow terrorists in so they can declare Martial Law and restrict everyone’s movement. All FREEDOM has been lost!
What Trudeau did in Canada permitted the bypassing of due process of law, which is the foundation of a free society. Wake up! Digitization of the monetary system will allow them to totally kill all dissent. There will be NOTHING left standing. This is what 2032 is all about. We are the ants beneath their feet. Anyone who thinks they care at all about us is an absolute fool.
We cannot stop it. This is NECESSARY for political change. This is them fighting to retain power when they fully understand that this monetary system is collapsing. This is not going to be this Great Taking. That would be an instantaneous revolution. They are not that stupid for even the army would rise up against them. This is about total control leaving you with your trinkets.
As this is rolled out, ONLY then will it open the eyes of the masses. Unfortunately, this is also why movements like Transgender, Black Lives Matter, you name it, are all about dividing the people. They MUST keep the people divided and fighting among themselves so they do not unite against the government, where the common denominator is FREEDOM.
It was Julius Caesar who said – Divide and conquer. Hitler attacked the Jews BECAUSE they were the bankers, and he needed to blame the hyperinflation on the bankers. He divided the people and then came – Papers, please! That is precisely what they are doing to us with CBDCs. This is the purpose of Gates’ UN-organized digital IDs. To prevent freedom of movement. Digital IDs to vaccine passports are all designed to prevent movement. Europe, as of January 1, 2025, will require visas from Americans to visit, and they will apply your social credit score to determine if you are eligible. Still, they intend to start World War III before that, creating an external distraction to divert people from the loss of liberty. This is the government’s objective- the enemy of freedom – as always, no matter what century or culture to look at.
Posted originally on Dec 17, 2023 By Martin Armstrong
QUESTION: Dear Martin and the team. Perhaps the chances are very low that this would somehow reach Martin. However, I would like to try to use “the power of the internet.” I have to try, so at least I am not blaming myself. I would like to ask a question and if somehow, possibly get the answer and Martin’s thoughts. (btw I bought your books, but sadly I can’t come to those conferences as they are quite far away, not to mention visas…!)
I am originally from Russia but came to the UK 9 years ago. I never thought that we would go threw such insanity during my life. My parents who passed in the 90s (the time when SU collapsed) believe that there is nothing scarier than this. Yet, based on their description, it looks like the 90s is coming worldwide, which scares me to the bones. I just can’t recognize the UK and the rest of the western countries anymore. After COVID (and also Brexit) everything twisted upside down. Cost of living, quality of life, education level, total surveillance, CBDC, digital ID and other things seem to be coming all worldwide.
Even in Russia, this ESG agenda (Sberbank was working with WEF on their cyberattack convention in 2019 for Christ’s sake!), social credit score, CBDC progressing! They are all in cahoots together… Many people don’t see a danger of those elements, and when you even try to explain the danger of those things, all what they call you are just another conspiracy theorist…. I understand that the storm is coming and most likely we will all come out as different people in 2032. I really hope that your prognosis is correct and there is a light in the end of the tunnel which brings at least some hope that we will not be stuck in this doom loop.
I am right now stuck in a dilemma which doesn’t give me peace, so I would like to try to use such an opportunity and ask questions about how Martin thinks:
1) The worst fear for me right now is being stuck in the UK. If we all go into such shit period, I would prefer to be in my home country (Russia). However, I have been in the UK for almost 10 years and was thinking about applying for a passport in 2025. After that, I was considering leaving the country for good. Question comes : is it worth it? If this all goes so downhill. How much time do I have till the storm comes, and will I not be able to leave? Is it really worth it? I can, of course, return home, but all those years which I have been in the UK will be basically worthless… Moreover, the passport opportunity could help me… one day…. This cross-road doesn’t give me peace of mind.
2) In your prognosis of the safest places you mostly consider the USA. What places in the UK are safest? Is Edinburgh safe? I can see that England is in full turmoil. All those green zealots and green zones which would destroy the economy… Not to mention those cameras today have been deployed everywhere.
3) Don’t you think that this world power grab will be worldwide? We can see that they all argue with each other, yet when it comes to COP-28 or WEF events, they all sit together… I can see the same things happening in Russia. The main bank, Sberbank, even has a director of ESG, plus they are pushing for CBDC and Machine-learning integration in the transactions… Madness. I still believe that I have a higher chance of surviving in Russia. I have parents who have their own garden…. And overall, it is easier to survive mentally when your parents are nearby… I greatly appreciate that you try to predict and guide us towards those insane times. If somehow this message arrives, could you please share your thoughts? Kind regards Max
ANSWER: This turmoil that we are heading into is global. There really will be no country that will not be affected in some way. The US Congress just passed legislation anticipating a Trump victory that is intended to PREVENT any president from withdrawing from NATO unilaterally as Trump had vowed. The politicians throughout the West are pushing us into World War III, and there is nothing we can do to stop this insanity.
The West is the aggressor. While they claim Putin’s invasion was unprovoked and this is about freedom and democracy, that is just nonsense. The Minsk Agreement was to allow the Donbas to have a free election. Merkel and the West lied to allow Ukraine to build an army to fight Russia which has been the plan all along. Zelensky, the puppet selling out his own country, stood up and said that Ukraine would rearm itself with nuclear weapons. So, in addition to tearing up the Minsk Agreement, Zelensky also tore up the Budapest Memorandum where Ukraine had more nuclear weapons than China. It was a major world nuclear power – the third-largest nuclear power in the world.
The Budapest Memorandum was where Ukraine made the decision to completely denuclearize in exchange, the U.S., the U.K., and Russia guaranteed Ukraine’s security in that 1994 agreement. Therefore, when Zelensky stood up and declared Ukraine would re-arm with nukes and was no longer going to be neutral, Putin had no choice but to come to the aid of the Donbas the next day. Zelensky never told his people and he said to the Washington Post that had he told the people Russia would invade, he would have lost $7 billion.
Hillary is saying that they are using Ukraine as cannon fodder and the plan is to weaken Russia to overthrow their government if you just listen. Afghanistan is the “model” to keep throwing Ukrainians into the war, and maybe the West will win. These people love to play God with nations, and people’s lives, on both sides. NEVER have I ever heard Hillary or any Neocon even once express remorse for the dead soldiers or their families where children grow up without a parent.
These Neocons are just hateful people, and they have seized power in Washington to wage war. They hate all Russians and Chinese because they used to be communists and they cannot let that go. They still have to defeat them no matter what.
Hillary is a Neocon who was behind the entire move to overthrow the governments of the Middle East – Iraq, Syria, and Libya. The Benghazi attack on the US embassy was because it was being used to funnel arms into Syria and Libya to create civil wars just as they have done in Ukraine.
Far too many politicians have been brainwashed by the Neocons. They think Putin is the enemy and may think they are supporting national security, but they too are just stupid pawns. Nobody in Washington is even interested in peace. Most are not competent to even comprehend that the West needs war so desperately as the excuse to justify CBDCs, capital controls, martial law, and the sovereign debt default that wipes out pensions so they also need to reduce the population to reduce their unfunded liabilities.
So where to hide? There will be safe places within many countries, even the UK, but they will be away from major cities. That is where the risk will lie. That was sort of the theme of the movie, strangely partly funded by Obama, Leave the World Behind, but that was really about taking down communications, including satellites. I found it curious that Obama would be behind such a film. This will certainly be one impact of war, which is why I am against digital currency, for you will be unable to buy anything. In the film, the only way a guy could buy medicine was with cash.
What you must understand is that all the old wounds will resurface. You even have Biden’s education official claiming that democracy, fatphobia, is based on white supremacy. At the same time, Obama’s new film is against white people. Look around the world. Whatever old dispute there was is resurfacing. Ukrainians hate Russian-speaking Ukrainians. The same is now unfolding in Estonia. All of this bullshit about “equality” is a smokescreen. The old hatreds are all surfacing and these will be part of the process of tearing about civilization as we head into 2032. So in your case, it may just be safer in Russia, for in World War II, they locked up Japanese who were born in the United States simply because of their race and ethnic origin. Be very careful about where you move to. Remember the Boxer Rebellion in China, where it was get all foreigners?
By the time we get to 2032, that will be the light at the end of the tunnel. The shit-storm, as they say, will begin primarily after 2024. The US election will further divide the USA, for NEITHER side will accept the result. The USA will eventually break apart into three primary regions: the South & midwest Bible Belt will join together against the Northeast, and the Pacific States will be their own la-la-land. You will most likely be safer with the region that best matches your political philosophy. Even during the American Revolution, they were confiscating assets of people who supported the king politically. There is NEVER any rule of law during the war – NEVER forget that. You have no rights it will always be the will of those in power.
I would get the passport as a hedge, but you may be safer in Russia than in the US or Europe. You certainly want to stay away from any major city no matter what country you are in. That is where the civil unrest will flare up the most. Keep in mind, cities like NYC, will be out of food in 7 days when there are no trucks to bring it into town.
In this interview between Kerry Lutz and Martin Armstrong, a different format was used. Martin took questions from the FSN community, covering a wide range of topics, including the US Debt clock, gold, China’s future, inflation, interest rates, and the impact of fraud on the system.
Armstrong predicts that all governments will change by 2032, including China’s, but that the people in China are not about to go back to communism. He also warns that the inflation in the US is due to shortages caused by COVID lockdowns. The discussion highlights the need for politicians to consider the long-term impact of their actions on society and the government.
The conversation also delved into the intricacies of government, currency, and debt. They discussed the benefits of term limits in government and the success of Genoa’s system. They also explored the instability of currencies without trustworthy economies and the flaws in the euro. The conversation then turned to the potential for the FDIC to default on savings accounts and the increasing control over financial transactions, highlighting the potential for draconian measures in the face of a collapsing system.
Marty expressed his concerns about the extreme actions of climate zealots who want to shut down all fossil fuels, heating, and air conditioning. He believes that their actions could lead to a mass die-off and civil unrest, especially in third world countries where people rely on gasoline to feed their families. The discussion also covered the viability of a gold standard as a basis for currencies.
Marty argues that a gold standard cannot work due to the business cycle and the involvement of weather in the economy. He also notes that changing the political system would be necessary to implement a gold standard, which would be difficult for Democrats who rely on promises of government programs to win elections.
Finally, the meeting covered the possibility of war and the influence of neocons. Marty shares his positive impression of Trump’s desire to pull troops out of Afghanistan, but notes that John Bolton immediately opposed the idea. They both express frustration with the delusional thinking of some neocons who believe that overthrowing governments will lead to ticker tape parades and cheers from the people. They also discuss the hypocrisy of advocating for regime change in other countries while opposing it in their own. Kerry promotes Martin’s website and encourages listeners to sign up for his regular missives and private blog.
Posted originally on Dec 16, 2023 By Martin Armstrong
Europe is desperate to commit geopolitical and economic suicide. They have bullshitted the people all along, and all they are interested in is creating war to devastate Europe a third time simply as the excuse to cover up the economic failure of the Euro and the fiscal mismanagement of the economy. All world leaders have been borrowing endlessly with absolutely NO INTENTION of ever paying off what they borrowed. These elites NEVER represent the people. They are putting all the lives of Europe and the world at risk – for what? Not a single one of these politicians will ever even consider peace. Rome had peace for 1,000 years BECAUSE everyone benefitted economically. These morons do the opposite imposing sanctions on people if they do not do as they command.
Europe has wanted war with Russia from the start. They negotiate in BAD FAITH to stall Russia so Ukraine could build an army and wage war against Russia to weaken it first BEFORE NATO finds the excuse to justify invading Russia. Where it was once Khrushchev saying he would bury the West by spreading communism, now, even though communism collapsed all by itself, the West has not abandoned the Cold War. It is on the very same mission to “spread” democracy to the world when we do not even have democracy – we are under a dictatorship pretending to be a republic representing the people when they represent only their own thirst for power. Russia would be a fool to negotiate with the West when they do not honor their agreements. This is why 2032 is necessary.
Here you have Hillary Clinton, a real warmonger who wanted to draft girls back in 2016 (which was why three girls in our office voted against her calling her a female Nazi). Listen to her. She states that Afghanistan is the “model” to suck in Russia, use the Ukrainians as bait, keep funding them to die for her agenda and weaken Russia. The agenda has never changed. They have sought to seize Russia and all its wealth since 1998, and their attempt to blackmail Yeltsin to seize control by installing their puppet Berzobvsky. They even tried to get me to invest $10 billion into this scheme. When I refused, Berezovsky even called me personally. Over 500,000 Ukrainians are dead on the battlefield, their country destroyed, and between 8 to 10 million have fled to Europe, all to seize Russia in this endless war.
Hillary said they did not expect Ukraine actually to defeat Russia. She also skips over the “unintended consequences” of Afghanistan, like the Taliban turning our weapons on Americans and, of course, 9/11 and the Iraq War. That’s a lot of “unintended consequences” that she pushes aside. So how many dead Ukrainians will this unintended consequence result in or the millions of Ukrainians who have fled to Europe with no intention of returning?
Viktor Orbán is the ONLY leader trying to save Europe from these Neocon warmongers. Russia is on the verge of total victory in Ukraine. So, the EU is desperate to try to rush Ukraine into the EU and then NATO. This proxy war, which has devastated Ukraine and sacrificed its people on the Neocon altar of world domination, has placed the US and the EU, along with NATO, in a difficult position. After all the propaganda about Russia and Putin as the aggressor, it has been the West that does not want peace, as evidenced by even the Ukrainian press reporting that the purpose of Boris Johnson’s visit was to make sure there would be no peace agreement. EVERYTHING we have been told is an absolute lie. The Russian people do not want war any more than the average European or American. Politicians always create war, and they ALWAYS lie about everything. They tried to take over Russia and even tried to bring it into NATO. This set in motion the 1991 collapse.
Posted originally on Dec 14, 2023 By Martin Armstrong
Whenever those in Congress mess with real estate, they have ALWAYS, and without exception, caused a major crash. The Entire Savings & Loan (S&L) Crisis was a catastrophic disaster that wiped out nearly one-third of all the 3,234 savings and loan associations in the United States between 1986 and 1995. I previously mentioned that hedge funds were created by a regulation conflict between the Commodity Futures Trading Commission (CFTC) and the Securities & Exchange Commission (SEC). If you obeyed one, you went to jail with the other.
Back in the 1980s, we began the S&P500 Report when futures started to trade. We had to refund everyone’s money and shut down the report because these two agencies were fighting over who had the regulatory power of stock index futures. We could not provide analysis as long as the two agencies fought for power. It came down to a Supreme Court decision that finally said forecasting was free speech – SEC v Lowe. Nevertheless, in funds management, you could not hedge for a client domestically because if you had a stock portfolio and you thought there was a crash unfolding, you were only allowed to hedge 17% for anything more than that made you a futures fund – rather than a stock fund. The only way to trade everything was to move offshore, and these were called Hedge Funds, which you were not allowed to do domestically. To this day, you have separate funds domestically, each claiming they are the best, forcing the decision onto the average person.
The S&L crisis was also created by Congress’s persistent quest to regulate things they do not understand. Once more, there was a conflict and mismatch of regulations regarding S&Ls v banks. Congress had imposed restrictions on S&Ls with the creation of the Federal Home Loan Bank Act of 1932, which included such caps on interest rates on deposits and loans. They also directed that S&Ls should be lending into the real estate market and banks should be focused effectively on businesses. The banks still could do mortgages.
The market conditions moved into deflation between 1981 and 1985 because Volcker raised rates at the Fed to 14% to stop inflation, which caused capital inflows to buy bonds, sending the dollar to rise dramatically on international markets. The British pound crashed from $2.40 to $1.03 by 1985. However, the regulations on how much interest an S&L could pay meant they could not compete with the rates that the Fed adopted, and nobody in Congress noticed until 1982. The S&Ls experienced a massive capital outflow, and they were left with low-interest long-term mortgages.
In 1982, President Ronald Reagan signed Garn-St. Germain Depository Institutions Act, which was intended to correct the conflict between high interest rates and caps on the S&Ls. The reform eliminated loan-to-value ratios and interest rate caps for S&Ls. In addition, it also allowed them to hold 30% of their assets in consumer loans and 40% in commercial loans for the first time. The S&Ls began paying higher rates to attract funds. S&Ls also began investing in commercial real estate, which had tax advantages with regard to amortization.
As always, the Democrat’s constant hunt to punish the rich with every breath they take caused the entire S&L crisis of the 1980s. The Democrats only see the money dangling in front of them and nothing else. They pushed through a landmark 1986 Tax Reform Act that reduced the top personal income tax rate from 50% to 28%. However, in a bitterly divided Congress, as usual, demanded a compromise and that the income tax cuts were to be paid for by raising the rate on capital gains from 20% to 28% and limiting the deductibility of real estate losses for passive investors. The braindead unintended consequences undermined the entire real estate market and took down the S&L Industry in the process.
The S&L crisis demonstrated that those in government NEVER understand the private sector. They created the business model of the S&Ls whereby they made 30-year fixed-rate mortgages, which Roosevelt invented to solve the real estate collapse back in the Great Depression. To provide those loans, S&Ls depended on a deposit based on DEMAND that could be withdrawn within 30 days. When the Fed raised rates to 14% in 1981, the S&Ls were in trouble and lost deposits when they were prevented from paying higher rates. That was not lifted until the Reagan 1982 reform. This is the basic banking model using on-demand money to lend out long-term. To this day, the Fed directs the “Model Risk,” which you can review at SR 11-7: Guidance on Model Risk Management.
At first, the measures seemed to have worked, and by 1985, S&L assets had risen by almost 50%. Commercial real estate became the “hot” market. This is what attracted the Democrats. They saw all this money pouring into mortgages, so they could not resist changing the laws to get at that money in 1986. The Economic Recovery Tax Act of 1981 accelerated the depreciation of commercial and noncommercial real estate, making those investments quite attractive. Then, the Democrats saw the money and pushed the Tax Reform Act of 1986 to extend depreciation schedules for both real estate forms, reducing the attractiveness of those investments.
These people NEVER understand market behavior. By extending the depreciation tables, they created a one-way market. Real Estate collapsed, everyone tried to sell, and there was NO BID! One of the few Congressmen with real estate experience at the time called me and asked what my model projected. I told him this would be a major crash that would cost a fortune because there were also government guarantees behind a portion of the mortgages left over from the Great Depression days. Nobody would listen to his warnings.
In the meantime, pressure was mounting on the Federal Savings and Loan Insurance Corporation’s coffers (FSLIC). By 1987, the FSLIC had become insolvent. Rather than allowing it and S&Ls to fail as they were destined to do, the federal government recapitalized the FSLIC, exposing taxpayers to even greater risk. The S&Ls were allowed to continue to pile on risk. I had a client who wanted to buy an S&L, and I advised him not to get involved and that the crisis would worsen. He did not listen, bought a failed S&L, and recapitalized it; as the crisis worsened, they kept changing the capitalization requirement, ended up seizing his S&L, and lost most of his investment.
A bill is now being introduced to Congress that will prohibit hedge funds and other institutional investors from buying single-family homes. What these people in Congress FAIL to ever understand, is that they will now eliminate that segment of buyers and create a one-way market. Prices will have to collapse as these investors will ONLY be able to sell to a mom-and-pop, and as we head into a recession from 2024 to 2028, this does not bode well for the blue states especially.
The intent of the bill is to address the housing supply, which continues to dry up as prices have been climbing 20% since 2021. They believe that the low housing supply is driving up prices, and they are pointing their finger at hedge funds to blame, like Blackrock. The bill’s sponsors are U.S. Senator Jeff Merkley (D-OR) and Representative Adam Smith (D-WA). Of course, they ignore their spending, and pouring countless billions into Ukraine has nothing to do with inflation, and certainly, their COVID scam had nothing to do with anything regarding prices or unemployment. It is NEVER them on Capital Hill – it is always we, the Great Unwashed.
This bill is entitled the End Hedge Fund Control of American Homes Act of 2023, targeting both hedge funds and private equity firms that have been buying single-family houses as investment properties. While the bill addresses a serious issue, what we MUST understand is that people “feel” rich when their homes rise in value, for they see that as their savings. Both the Great Depression and the Great Recession of 2007-2009 impacted real estate, and this is the MOST sensitive area of the economy. You can take the stock market down 90% and the bond market. They will impact only a portion of the economy, typically the upper classes. However, when you take down the real estate market, now you are messing with the bulk of the middle class.
Senator Jeff Merkley said in his statement, “The housing in our neighborhoods should be homes for people, not profit centers for Wall Street.” While I do not support Blackrock and its agenda, this is closing the barn door after the horse ran away. He has made a big splash, saying: “It’s time for Congress to put in place commonsense guardrails that ensure all families have a fair chance to buy or rent a decent home in their community at a price they can afford.”
Larry Fink, BlackRock CEO, is a board member of Klaus Schwab’s World Economic Forum who preaches you will own nothing and be happy. Fink is also behind Zelensky, promising to invest in a war zone. Meanwhile, Fink sent his 2022 letter to CEOs of companies he has invested in on January 17th, 2022, while intimidating them to follow Schwab’s WEF. His letter reflected Klaus Schwab’s Agenda 2030. He stated:
“I write these letters as a fiduciary for our clients who entrust us to manage their assets – to highlight the themes that I believe are vital to driving durable long-term returns and to helping them reach their goals.”
BlackRock insists that it does not invest in single-family homes. It claims that it invests in multifamily properties, apartment complexes, and other residential real estate. They insist that they are not one of the large asset managers and private equity firms who have been buying single-family homes.
On August 2, 2021, CNN reported that during the first three months of 2021, “nearly a quarter of all homes sold in the United States were going to investors.” They reported that BlackRock (BLK), JPMorgan Chase (JPM), and Goldman Sachs (GS) were among the big-name buyers. They further reported, “Institutional investors still own only about 2% of all single-family rentals in the United States, or roughly 300,000 homes, according to John Burns research director Rick Palacios.”
The headline from 2021 made it sound that Blackstone was BUYING 17,000 single-family houses, outbidding regular mom-and-pop buyers with its $6 billion war chest. Blackstone bought Home Partners of America, which had already owned 17,000 single-family houses, and rents them out to tenants with an option to buy at a preset price at any time with 30 days’ notice. They insist that they are facilitating private home ownership by providing an option to buy.
Here is a chart provided by Freddie Mac, which shows the contest between large institutional buyers vs mom-and-pop as a percentage of the marketplace. The overall market share of investors has grown to around 30%. Like the changing of the depreciation table on real estate in 1986 by the Democrats caused a one-way market of sellers with no bid, outlawing investors now when they already have 30% of the market can lead to a MAJOR recession following the ECM between 2024 into 2028.
We have a Directional Change in 2024 and should expect higher volatility into 2025.
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This is a library of News Events not reported by the Main Stream Media documenting & connecting the dots on How the Obama Marxist Liberal agenda is destroying America
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